Quant Momentum Trade Is Hot Again in Crypto Amid Sharp Reversal

To the crypto faithful, buying and holding Bitcoin is the only trading game in town — offering about a 50% return so far this year alone for new investments.

For quantitative hedge-fund investors and a spattering of academic researchers, however, there’s a better way to capture the volatile asset’s rally, while also profiting from the huge drawdowns: Simply follow the wisdom — or folly — of the crowd.

From the world’s largest publicly traded hedge-fund manager, Man Group Plc, to scholars at the University of Cambridge and beyond, a growing body of research signals that the quant strategy of ...