In this episode, we return to hedge funds in commodities, with a focus on metals and mining. How has the role of hedge funds evolved in this space? What are investors and allocators looking for when building commodities exposure? And where can a lasting edge still be found?
Speaking to our host, Paul Chapman, on this episode is Matt Heap, founder and CIO of Forth Fund Management, a sector-specialist hedge fund dedicated to metals and mining, launching in Switzerland. Matt has had a phenomenal career in metals trading, both in hedge funds at Orion Resource Partners, and then prior to that, at Louis Dreyfus, where he was global head of metals proprietary trading.
Podcast Briefing: 5 Talent Trends
Shift towards research-driven investment talent
Firms are prioritising candidates with strong research capabilities, combining data analysis, market understanding and structured processes, as research-intensive investment approaches are increasingly seen as the foundation of consistent hedge fund performance.
Growing demand for hybrid human–technology skillsets
There is rising demand for professionals who can combine human judgement with advanced technology and data tools, as firms seek traders who can adapt quickly while leveraging systematic and quantitative insights.
Talent shortage in commodities trading
A structural shortage of experienced commodities professionals is emerging, driven by years of underinvestment in the sector, creating a supply-demand imbalance and intensifying competition for proven trading talent.
Increased need for adaptable, multi-strategy traders
Employers are seeking traders capable of operating across directional, relative value, and value strategies, reflecting more complex and varied market conditions that require flexibility across different trading environments.
Rising value of physical market experience
Candidates with backgrounds in physical trading houses remain highly valued, as firms prioritise individuals who can interpret real-world supply-demand signals, even as data access becomes more widely available.
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Podcast Summary
Edited highlights and themes from the podcast episode.
How have hedge funds in commodities evolved in recent years?
Hedge funds in commodities have evolved through distinct phases, with increasing demands for transparency, flexibility, and risk control. Following the global financial crisis, investors moved towards managed accounts, and more recently, separately managed accounts (SMAs), enabling greater oversight and control.
What do investors look for in commodities hedge fund strategies today?
Investors prioritise consistent, risk-adjusted returns and greater transparency. There is also growing demand for strategies combining human insight with data-driven approaches, reflecting the increasing role of technology and systematic trading in commodities markets.
Why is there increasing interest in metals and mining investments?
Metals and mining are gaining attention due to long supply cycles and structural demand growth. New supply can take six to ten years to develop, while demand is supported by industrial shifts such as electrification, renewables, and advanced technologies.
What drives a sustainable edge in commodities trading?
A lasting edge comes from strong research processes, effective interpretation of market data, and adaptability across varying market conditions. While data access has broadened, competitive advantage increasingly lies in how information is analysed and applied.
What talent trends are shaping the commodities sector?
The sector is experiencing a shortage of experienced professionals, driven by years of underallocation and limited talent development. Firms are seeking adaptable traders with both technical skills and real-world market experience.