This figure is for illustrative purposes only and does not represent a guarantee of future performance.
Here are some regulatory notes before we get started. Solimar Fund is a Rule 506(c) of Regulation D fund and only available to verified accredited investors. All fund returns are net of fees and expenses, unaudited, as reported by NAV Fund Services. Individual results may vary. Past performance is not necessarily indicative of future results.
The numbers.
Solimar Fund returned -0.7% in February after fees. The SPY closed the month down -0.9%.
Here’s What We’ve Been Feeling: Sideways Churn.
For the past six months, the broader US equity market has largely gone nowhere.
The S&P 500 (SPY) has been stuck in a sideways range, bouncing back and forth without establishing a sustained trend (blue highlighted region below). While that might sound calm on the surface, this type of environment can be one of the most difficult for systematic strategies.
Markets like to reward clarity. Strong trends reward momentum systems. Sharp dislocations reward mean-reversion systems. But sideways markets tend to reward neither.
Instead, they create what traders call “chop.”
Prices break out, only to reverse a few days later. Pullbacks look promising but fail to follow through. Signals that normally develop into durable moves instead stall out halfway and reverse.
This environment can grind down both momentum and mean-reversion approaches. Entries trigger. Stops get hit. Positions reverse. And the cycle repeats.
Over the last six months, the market has been doing exactly that.
It’s important to emphasize that this kind of market behavior is normal. Markets spend a surprising amount of time consolidating rather than trending. But during these periods, even well-designed systems can take a few bruises while waiting for the next environment that better fits their statistical edge.
You could think of it like surfing.
Some days the waves are clean and lined up like corduroy. The kind of conditions where every set seems rideable. Other days the ocean is crossed-up and messy, with waves coming from multiple directions. Even experienced surfers spend more time paddling and repositioning than riding, if they even go out.
The past six months in the market have felt a bit like those crossed-up conditions.
The good news is that sideways ranges eventually resolve. When they do, they often produce some of the most powerful moves of the year as pent-up energy finally releases in one direction or the other.
The goal is not to win every month or quarter. The goal is to be positioned for the environments where our edge shows up most clearly. For Solimar Fund, that means targeting annual outperformance of the SPY, with the probability of that outperformance increasing over three to five year periods.
Markets move in regimes. Strategies go through cycles. What matters is staying consistent through both.
*There is no guarantee such results will be achieved and individual results will vary based on entry point and length of investment.
Into Q2
At the end of March we’ll already be a quarter of the way through the year. Q1 has been a reminder that markets don’t move in straight lines. Periods like this are part of the journey: sideways, noisy, and unpredictable.
Our focus during times like this is simple: stay disciplined, manage risk, and continue executing the system exactly as designed.
We’re grateful for your continued trust and partnership. We don’t take that lightly.
Year three is about continuing to prove the durability of what we’ve built. Our goal remains, no down years. We have plenty of 2026 left to continue meeting that goal.
Enjoy the ride!
Geoffrey & Tyler
2by2 Capital LLC | [email protected] | www.2by2Capital.com
Lifetime Performance Comparison: Solimar Fund vs. SPY
Solimar Fund Net Lifetime Performance (10/1/23-2/28/25): 55.7% after fees.
SPY Performance (10/1/23-2/28/25): 60.4%
The SPY is presented solely as a broad equity market reference. The Fund does not attempt to replicate the SPY, and its strategy and risks differ materially.
