The sharp rise in oil prices and heightened market volatility stemming from the Iran war have produced an unexpected group of winners this year: quantitative hedge funds that use computer-driven models to identify and trade market trends.
The conflict has fueled major moves across commodity, currency and futures markets. Those conditions have created a favorable environment for commodity trading advisors, or CTAs, which rely on systematic strategies rather than discretionary investment decisions.
Many of these funds have posted double-digit returns in 2026 after successfully capturing rallies in crude oil, gasoline and diesel markets during the early months of the conflict, according to CNBC.
The performance has revived memories of 2022, when commodity prices surged following Russia’s invasion of Ukraine and trend-following hedge funds recorded some of their strongest annual gains on record. The latest geopolitical shock has once again driven substantial activity across energy markets as traders react to supply disruptions and concerns over fuel availability.
The sector’s benchmark SG CTA Index has gained more than 12% so far this year, while the SG Trend Index, which tracks the largest trend-following hedge funds, has posted a similar increase, the CNBC report noted.
Energy markets have played a central role in those gains. Helen Doody, head of Abbey Capital U.S., told the outlet that many funds established long positions in crude oil during the first quarter as prices climbed following the outbreak of hostilities. Similar strategies also benefited from gains in refined fuel products including gasoline and diesel.
Nicolas Gaussel, chief executive and chief investment officer of Metori Capital Management, said energy-related trades accounted for roughly one-third of his firm’s returns this year.
Market volatility has extended well beyond crude oil. Quantitative funds have also benefited from movements in precious metals, industrial commodities and foreign exchange markets as investors adjusted positions in response to geopolitical developments and shifting inflation expectations.
Yung-Shin Kung, chief investment officer at Mast Investments, told CNBC that many CTAs captured gains in gold and silver earlier in the year before increasing exposure to industrial metals linked to artificial intelligence infrastructure spending and supply-chain disruptions associated with the conflict.
The broader commodity rally has been reflected in global markets. Gold prices reached record highs during the year as investors sought traditional safe-haven assets amid geopolitical uncertainty, while industrial metals also attracted investor interest because of growing demand from technology and energy-transition sectors, according to Bloomberg.
Currency markets have also contributed to hedge fund gains. Commodity-linked currencies, including the Norwegian krone, Australian dollar and Brazilian real, strengthened during parts of the year as investors reassessed global growth prospects and energy market dynamics.
Despite the strong performance, some managers have begun reducing exposure to energy markets as oil price momentum has moderated. Doody told the outlet that long positions across energy contracts have been trimmed in response to increased volatility and less consistent price trends.
Several market participants cited in the report said funds remain invested in energy markets but are carrying smaller positions than earlier in the year as risk management models respond to changing market conditions.
Meanwhile, fixed-income markets have presented a different picture. Rising inflation concerns tied to higher energy prices have pushed yields upward in several major economies, leading many CTAs to maintain short positions in government bond futures.