Firm Disclosure:
Systematic mechanical trend following in all worldwide liquid futures markets. The fund uses the strategy of following and profiting from a price trend. GCT uses only technical, computer-aided trading systems. The technical trading system is used to recognize early trends and has been developed under particular recognition of a good relationship of profit and drawdown, to minimize the market risk. When several individual technical indicators match to a high expectancy entry signals, then a trade is generated. The risk of every trade is limited to a maximum of 2.0% of the capital, but most trades have a risk of only 0.6%, depending on the correlation to the other markets. As soon as a position is entered, there is always a protective stop, to take the position out of the market in a disciplined way, to either limit losses or realize gained profits. If the volatility in an open position increases too much, the trading system cuts back the position size, to keep our risk in predetermined ranges.
Quadriga principals include: Christian Baha and Christian Halper.
From Software to Systematic CTA: The Quadriga Origin
Christian Baha and Christian Halper did not begin in trading. They began in software. In 1991 the two built a system for the technical analysis of financial data. Within two years that software had become the leading provider of market delivery software in Austria, a position that gave them both deep technical familiarity with systematic price analysis and the capital base to move into fund management.
Christian Baha founded the Quadriga Investment Group in 1995. The group launched its first alternative investment product for private investors on March 8, 1996, under the name Quadriga Beteiligungs- und Vermogens AG. That launch placed Quadriga at the early edge of the retail-accessible managed futures market in Europe, well before the institutional and retail distribution infrastructure for systematic CTAs had fully developed on the continent.
In 2003 the Quadriga funds were consolidated and rebranded under the umbrella name Superfund, which grew to over $1.5 billion in assets under management from more than 55,000 retail and institutional investors across more than 280 employees worldwide. The Quadriga page documents the firm as it was before that consolidation.
Reading the Disclosure: Position Sizing and Protective Stops
The Quadriga disclosure is precise about risk management in a way that most fund disclosures are not. Two numbers stand out: a maximum risk per trade of 2.0% of capital, with most trades carrying a typical risk of only 0.6%. The difference between the ceiling and the typical figure reflects the role of market correlation. When a position is correlated to other open positions in the portfolio, the effective portfolio risk from that trade is higher than its standalone figure. The 0.6% typical reflects a diversified portfolio where individual trade correlations are low. The 2.0% ceiling is the protection against concentrated or correlated exposure.
The commitment to a protective stop on every position is the mechanical expression of the same discipline at the core of the TurtleTrader rules. A stop that is set at the time of entry and honoured without exception removes the psychological failure mode that destroys most discretionary traders: the tendency to hold a losing position past the point where the original entry thesis has been invalidated. Quadriga’s disclosure makes explicit what is implicit in every serious systematic trend following operation: the exit discipline is as important as the entry signal, and it must be predetermined and mechanical.
The volatility-based position sizing adjustment, cutting position size when volatility in an open position increases, is a standard feature of well-designed systematic systems. High volatility in an existing position means the market is behaving in a less orderly way than the system expected. Reducing size under those conditions keeps the risk exposure within the system’s designed parameters even when the market is not cooperating with the original position.
The Indicator Confluence Entry
The disclosure describes entry signals generated when multiple individual technical indicators match to produce a high-expectancy signal. This multi-indicator confluence approach reduces the number of false entries that a single-indicator system would generate. A twenty-day breakout entry, for example, fires on every breakout to a new twenty-day high or low regardless of any other market conditions. A confluence-based entry only fires when additional conditions are met. The trade-off is fewer entries, some of which would have been profitable, in exchange for a higher probability of success on the entries that are taken.
The system was developed with a specific emphasis on the ratio of profit to drawdown, not on maximising raw return. That design priority reflects a sophisticated understanding of what makes a managed futures product viable for retail and institutional investors: not the highest possible return in a good year, but a track record that investors can remain in through the difficult periods that all trend following systems produce.
Frequently Asked Questions About Quadriga
Who founded Quadriga?
Christian Baha founded the Quadriga Investment Group in 1995, along with Christian Halper. Both had built and sold technical analysis software in Austria starting in 1991. The group launched its first fund for private investors in March 1996 and rebranded the operation as Superfund in 2003.
What is the GCT trading system?
GCT is Quadriga’s computer-aided technical trading system, referenced in the firm disclosure. It uses multiple technical indicators to generate entry signals when they reach a confluence of high-expectancy conditions. The system applies position sizing based on correlation to other open positions, a maximum trade risk of 2.0% of capital, a protective stop on every position, and volatility-based reduction of position size when existing positions become more volatile than expected.
What happened to Quadriga?
In 2003 the Quadriga funds were consolidated globally under the Superfund brand name. The unified group grew to over $1.5 billion in assets under management from more than 55,000 investors. The Superfund page on TurtleTrader provides further context on the group’s development after the rebrand.
How does Quadriga relate to trend following?
Quadriga’s disclosure is a direct statement of systematic trend following principles: mechanical entry and exit rules, no discretionary overrides, protective stops on all positions, position sizing based on volatility and correlation, and a focus on long-term directional price moves across liquid global futures markets. The approach applies the same foundational methodology used by the TurtleTraders to a European retail and institutional investor base.
Trend Following Systems
Want to learn more and start trading trend following systems? Start here.
