From the Trading Desk at Stipelis
The Stipelis NAV Report – Insights from a Commodity Trading Advisor and Futures Trader
Crisis Alpha and Geopolitical Risk
Nothing tests investor confidence quite like sudden geopolitical escalation. Over the weekend the United States and Israel launched a series of coordinated military strikes against Iranian targets, prompting tense diplomatic exchanges and emergency meetings at the United Nations while markets reacted to the uncertainty.
When headlines like this hit, many investors instinctively tighten up. They reduce risk. They shift money toward perceived safety. That’s human. But what markets actually do during these periods depends on price action, not sentiment. Prices rise, prices fall, and trends form. That is the domain where managed futures operate.
Managed futures are built to follow trends across a wide range of global futures markets; from stock indexes and interest rates to currencies and commodities. The direction of the trend does not matter. What matters is that sustained movement exists. When markets break out of range, traditional portfolios often struggle. Managed futures can respond.
During times of stress like rising geopolitical risk: correlations between stocks and bonds often increase. They tend to move together rather than diversify each other. That means traditional diversification can weaken just when it’s needed most. Managed futures do not rely on a single market behaving a certain way. They allocate across many different types of markets, and they can go long or short. This structural flexibility allows them to participate with the trend, wherever it appears.
This historical behavior is the basis of what investors refer to as crisis alpha: the ability to generate positive returns during periods of market stress when traditional assets may lose value. It is not about predicting crises. It is not about forecasting headlines. It is about responding to what markets actually do.
For example, during energy supply shocks, commodity prices may spike. During rapid risk-off moves, currency pairs and bond markets may trend strongly. Managed futures strategies are designed to capture those moves, based on price behavior, not narrative.
Right now, geopolitical headlines are dominating discussions and affecting sentiment. But sound investment decisions require discipline and focus on data and risk. At Stipelis we follow a rules-based approach. Positions are sized to manage volatility. Exposure is diversified across asset classes. Risk is controlled before the markets move, not after.
We measure diversification not by the number of positions but by how those positions behave relative to each other. A truly diversified program should reduce overall portfolio risk, not just add more positions. That is the principle we follow every day.
Transparency is part of trust. That is why we provide this NAV report each week. Not just returns, but how those returns were achieved, how risk was controlled, and how positioning reflects market conditions.
It’s also important to recognize that no strategy works in every environment. There will be times when trends are unclear and performance is flat or negative. Managed futures are not immune to weak or choppy markets. But over time, the ability to participate in strong trends both up and down can contribute to better risk-adjusted performance. That’s the difference between reacting to fear and responding with purpose.
In recent weeks, markets have priced in rising geopolitical risk. We have seen movement in energy, currencies, bond yields, and equity volatility. Our approach does not bet on a particular outcome. It responds to the trends that emerge from price behavior across markets.
As always, we focus on risk management first. That means controlling exposure, setting appropriate limits, and rebalancing as conditions change. When prices do break out of ranges, the strategy captures that movement. When markets are choppy, we stay disciplined and patient.
This is why we believe managed futures can matter in turbulent times like these.
Stephen Coleman-Founder
Stipelis Global Trading LLC
Stipelis Global Trading LLC is registered with the Commodity Futures Trading Commission and is a member of the National Futures Association.
Member ID 0474441
The opinions expressed are those of Stipelis Global Trading LLC and are considered market commentary. They are not intended to act as investment recommendations. Individuals should make investment decisions based on their own analysis and with direct consultation with a financial advisor.
THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION.