AI Hedge Funds Stumble While Crypto Funds Surge in January
Artificial intelligence hedge funds experience a sharp decline to start the year, while cryptocurrency funds see massive gains that beat out bitcoin's performance.
Fund managers using artificial intelligence and machine learning strategies see a significant drop of 8.41% in January, contrasting sharply with their 11.24% return for the full year of 2020. The Eurekahedge AI Hedge Fund Index tracks over a dozen constituent funds to measure the performance of managers applying AI theory in their trading processes.
Meanwhile, cryptocurrency hedge funds enjoy an impressive 30.96% gain in January, easily outperforming bitcoin itself, which gains 20.35% over the same period. The Eurekahedge Crypto-Currency Hedge Fund Index measures the performance of fund managers allocating to bitcoin and various other digital currencies.
Despite falling short of bitcoin's massive 296.74% return in 2020, these crypto funds still post a remarkable 200.61% gain for that year. The divergence highlights a dramatic shift in momentum between algorithmic trading strategies and digital asset funds as the new year begins.