Peter Went, the Senior Director of CFA Institute tweeted about the Pythagoras Investment Management’s performance gains amidst the crypto market collapse, as reported by Bloomberg.
As per the reports, the Pythagoras Investment Management’s two funds, namely, Market Neutral Fund and Pythagoras Token Fund had gained almost 8% each this year.
Since the once-leading crypto exchange FTX filed bankruptcy, the whole crypto world had been facing serious losses and crashes as traders were suspicious about the security of digital assets. Even the largest digital currency bitcoin had declined almost by 60% this year.
The Chief Executive Officer of Pythagoras commented that the market-neutral fund uses arbitrage, which allows the company to make a profit by buying at low prices and selling at high prices.
On the other side, the trend-following fund makes use of technical indicators to analyze the short-term trends in the market:
The CEO of Pythogoras stated:
“The idea is to use quantitative, technical indicators to try to detect trends, either up or down. When you detect an upward trend, you go long when you think the psychology of people is that they think it’s going up. And when the trend is going down and everybody’s selling, you go short.”
Futhemore, the CEO added that the company’s final outcome is positive returns regardless of the condition of the market:
“We particularly outperform in bear markets. Our absolute-return funds are positive whether the market’s up or down — whether it’s a bull market, a bear market, we’re going to have positive returns.”
Notably, before the FTX crash, Pythagoras’s arbitrage fund had 10% exposure to FTX. Though the company received only a 7% refund even after requesting a complete refund, it helped the company to get spurred by shorting the FTX native token.