Key Takeaways
- • Aspect Alternative Markets won The Hedge Fund Journal's CTA and Discretionary Trader Awards 2022 in the Alternative Markets Trend Follower (Financials and Commodities) category for its 2021 performance.
- • The program trades 260 markets across five asset classes, including onshore and internationalized Chinese futures, Treasury Inflation-Protected Securities (TIPS), and less accessible emerging market instruments with reduced sensitivity to global risk factors.
- • Alternative markets' primary advantage is internal diversification—fragmented, regional, and idiosyncratic markets exhibit lower correlation to common risk drivers such as risk-on/risk-off sentiment and global interest rates, according to Razvan Remsing, Director of Investment Solutions at Aspect Capital.
- • In 2021, the strategy capitalized on emerging market interest rate trends before developed market central banks commenced rate hikes; however, through the first five months of 2022, traditional-markets-focused CTAs (Aspect Core and Aspect Diversified) outperformed in absolute returns.
- • Long commodities and short bonds drove returns across both alternative and traditional markets strategies, with energies and agriculturals leading performance, though individual market selection and sizing differ substantially between programs.
Summary
Aspect Alternative Markets, a systematic investment program managed by London-based Aspect Capital, has garnered recognition from The Hedge Fund Journal for its 2021 performance, receiving the CTA and Discretionary Trader Awards 2022 in the Alternative Markets Trend Follower category focused on financials and commodities. The award underscores the program's competitive positioning within the managed futures space.
The core strategic thesis underlying Aspect's alternative markets approach centers on diversification benefits derived from less correlated asset classes and geographies. According to Razvan Remsing, Director of Investment Solutions at Aspect Capital's London office, "more fragmented, regional and idiosyncratic markets have less global sensitivity to common risk factors such as risk on versus risk off, or global interest rates." This structural advantage is particularly valuable for institutional investors seeking portfolio diversification independent of traditional equity and bond market movements.
The program's scope is substantial: Aspect Alternative Markets trades 260 markets spanning five asset classes, including both onshore and internationalized Chinese futures contracts, emerging market interest rates, Treasury Inflation-Protected Securities (TIPS), and other instruments with limited accessibility in traditional investment programs. In 2021, the strategy successfully captured rising rate trends in emerging markets before most developed market central banks initiated their own rate increases, demonstrating alpha generation through early positioning in less-followed markets.
Performance dynamics have shifted materially in 2022. While alternative markets historically generated stronger standalone trends, Aspect's analysis suggests this is not a structural phenomenon across full market cycles and geographies. Through May 2022, traditional-markets-focused programs—Aspect Core and Aspect Diversified—have outperformed in absolute returns. Nevertheless, both alternative and traditional strategies have benefited from the same macro theme: long commodity positions and short bond exposures. Performance dispersion emerges at the sub-asset class level, where energies and agriculturals led gains, but individual market selection and position sizing differ substantially between programs, indicating divergent tactical implementation despite shared directional exposure.
The core strategic thesis underlying Aspect's alternative markets approach centers on diversification benefits derived from less correlated asset classes and geographies. According to Razvan Remsing, Director of Investment Solutions at Aspect Capital's London office, "more fragmented, regional and idiosyncratic markets have less global sensitivity to common risk factors such as risk on versus risk off, or global interest rates." This structural advantage is particularly valuable for institutional investors seeking portfolio diversification independent of traditional equity and bond market movements.
The program's scope is substantial: Aspect Alternative Markets trades 260 markets spanning five asset classes, including both onshore and internationalized Chinese futures contracts, emerging market interest rates, Treasury Inflation-Protected Securities (TIPS), and other instruments with limited accessibility in traditional investment programs. In 2021, the strategy successfully captured rising rate trends in emerging markets before most developed market central banks initiated their own rate increases, demonstrating alpha generation through early positioning in less-followed markets.
Performance dynamics have shifted materially in 2022. While alternative markets historically generated stronger standalone trends, Aspect's analysis suggests this is not a structural phenomenon across full market cycles and geographies. Through May 2022, traditional-markets-focused programs—Aspect Core and Aspect Diversified—have outperformed in absolute returns. Nevertheless, both alternative and traditional strategies have benefited from the same macro theme: long commodity positions and short bond exposures. Performance dispersion emerges at the sub-asset class level, where energies and agriculturals led gains, but individual market selection and position sizing differ substantially between programs, indicating divergent tactical implementation despite shared directional exposure.
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