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>>Relative‑value approaches outperform directional wagers as crypto volatility spikes.

Relative‑value approaches outperform directional wagers as crypto volatility spikes.

crypthub

about 2 hours ago

Market Overview

Crypto hedge funds lost 1.49% in January 2026, marking a fourth consecutive monthly decline not seen since 2018‑19. Macro uncertainty and sharp price swings have shifted investors to relative‑value and market‑neutral trades. Bitcoin dropped ~31%, Ethereum ~23% and Solana ~47% over the last six months.

Fund Performance

Fundamental funds fell 3.01% and quantitative funds 3.51% in the month, while market‑neutral strategies gained about 1.6%. Over six months neutral funds are up nearly 5% versus a 24% loss for fundamental funds. Their outperformance underscores the edge of non‑directional approaches.

Investor Positioning

Flow data show traders moving from early‑month bullish calls to defensive hedges and tactical fading by week three. Leverage stayed orderly, avoiding the chaotic reset of October 2025, and no broad panic liquidation occurred. Analysts say without clearer policy or a crypto‑specific catalyst, rallies may fade and volatility will remain headline‑driven.