August 2021 Kettera Strategies Analysis Summary
In the world of systematic trend programs, August 2025 saw a mixed performance across various sectors. However, soft commodities like coffee, sugar, and cocoa, proved to be a shining light, contributing positively to the strategies in certain instances.
Recent reports suggest that some trend programs made a "fair amount of money" on soft commodities, such as coffee, alongside gains in grains. This performance was achieved in a broader market environment that was weak for grains last year but improved more recently [2]. Another program highlighted favorable short-term trading returns, even when typical medium/long-term trend models struggled, with an 11.82% return during market dislocations caused by events like tariff surprises [3].
While the exact August 2025 performance split by commodity type versus other sectors is not directly detailed, these insights suggest that soft commodities can contribute positively but may have varied returns tied to volatility and trend persistence.
The success of these programs in soft commodities can be attributed to their ability to benefit from positive trends in these markets, such as the one seen in coffee and cocoa in the previous year [2]. However, medium to long-term trend followers have faced challenges during stable or declining volatility periods and sharp market reversals, which have broadly impacted many sectors. More agile short-term programs, on the other hand, have been able to capture dislocations and post solid returns, potentially including soft commodities among other markets [3].
In addition to soft commodities, August was a profitable month for short positions in corn and soybeans, while long wheat was a common profitable trade. However, the metals markets and crude and refined products presented a frustrating picture, with directional trading proving unprofitable except for natural gas long and bull spreads trades in the second half of the month [4].
It's important to note that the indices and other financial benchmarks mentioned are for illustrative purposes only. The views expressed in this article are those of the author and not necessarily those of AlphaWeek or its publisher, The Sortino Group.
In conclusion, soft commodities have shown the potential to outperform or contribute positively to systematic trend programs under the right conditions. Their performance varies with market volatility and trend conditions, with short-term, adaptive programs often outperforming traditional long-term trend followers in stable or reversing markets. While detailed Producer Price Index or broad market forecasts specific to soft commodity trend program performance relative to other sectors in August 2025 are not available, market commentary supports the view that these programs can generate notable gains in soft commodities under favorable conditions.
Finance and technology can play a crucial role in harnessing the potential of soft commodities for investing. For instance, advanced algorithms and predictive analytics, enabled by technology, can help trend programs identify and capitalize on positive trends in soft commodities like coffee, thereby generating substantial returns, as demonstrated by some programs in August 2025. Moreover, these technology-driven tools can enable agile short-term programs to capture dislocations and post solid returns, possibly including soft commodities among other markets.
