October brought a record high for Bitcoin and then a sharp sell-off. Classic Stable returned +14.53% and Classic Diversified returned +13.90%, as the trend algorithms earned in both phases of the month.
Performance
| October | Year to date | |||
|---|---|---|---|---|
| Gross | Net 25% | Gross | Net 25% | |
| Classic Diversified | +13.90% | +11.73% | +47.26% | +24.15% |
| Classic Stable | +14.53% | +14.53% | +36.24% | +20.53% |
| 12 months | Since 1 January 2024 | ||
|---|---|---|---|
| Gross | Net 25% | Gross | |
| Classic Diversified | +109.83% | +76.90% | +488% |
| Classic Stable | +73.67% | +53.64% | +311% |
Portfolio manager’s comment
Bitcoin reached an all-time high of about $126,200 on 6 October, after a climb of almost two weeks from about $109,000 in late September. It was a record for the largest crypto asset.
A sharp reversal followed. On 10 and 11 October the market saw the largest one-day liquidation of futures positions on record, about $20 billion. Bitcoin fell from about $122,500 to about $102,000, and the heavy use of leverage turned the fall into a chain of forced liquidations.
Altcoins, memecoins and AI tokens fell harder than Bitcoin, by 30% to 70% in many cases. About 75 of the top 100 crypto assets ended the month lower. The total market capitalisation of crypto assets declined by about 9% in October, from $4.08 trillion to $3.70 trillion.
What drove the results
The algorithms first captured the rise at the start of October, then profited from the fall. Trend-following algorithms trade in both directions, so a sharp decline is a source of return as well as a risk. Bitcoin itself returned −3.89% over the month.
The second half of October was range-bound, and the strategies gave back a small part of their gains. Classic Stable finished at +14.53% and Classic Diversified at +13.90%.
Volatility still has room
Over the three months to 31 October, Bitcoin returned −5.31%, a modest move against the swings inside the period. Volatility, realised and expected, still has room to expand.
The strategies trade long and short across liquid perpetual futures, and they trade under fixed risk controls. Wider moves in price, in either direction, are the conditions in which the algorithms work.