Trend Following and Drawdowns: Is This Time Different?

Man Group

Russell Korgaonkar

Research

43 Pages

Man Group’s report analyzes the performance of trend-following (systematic) strategies during the 2025 market drawdown and challenges the notion that “this time is different.” Despite recent underperformance, their analysis—across historical and simulated periods—confirms that persistence and discipline typically restore strategy efficacy.

Key Takeaways

Recent struggles are expected: Trend-following often underperforms during initial drawdowns and amid crowded, fast-moving markets.
Stick to the process: Historical patterns show resilience—strategies that stayed the course eventually outperformed through persistence.
No regime shift seen: Evidence across multiple tests suggests recent performance dip reflects normal variability, not structural market change.
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