The big headline out of China in January was the launch of DeepSeek’s R1 LLM, which was developed with a fraction of the resources used to create the large incumbent platforms .  The news has certainly caught the eye of investors as the founder of Deepseek is also the co-founder of a quant manager.  We believe the development will help democratize the power of LLMs that were previously not accessible to most parts of the world outside of the US.  Goku will also leverage DeepSeek’s open-source model as a tool for research – we will share more details in our next issue of “GokuTech Insights".

January was a good month for the market neutral strategy as the Cayman fund was up 1.7%.  The vast majority of the return was from idiosyncratic (residual) risk, and the attribution was well balanced between the single stock long and short books.  Factor attribution as a whole was a small contributor during the month, with size, beta, and earnings yield being positive contributors with book-to-price ratio and momentum being detractors.