Algorithm-driven funds win on Brexit night

London

AS hedge fund manager Buford Scott sat at home, watching the TV in shock as it emerged Britain had voted to leave the European Union, his computer-based trading models were quietly boosting his business by 1.5 per cent.

Mr Scott's algorithm-driven fund, and others like it, beat hedge funds run by humans on "Brexit" night, not because the computers had correctly predicted the results of the June 23 referendum, but because they followed trends already in place.

Computer-driven funds placed bets on safe-haven assets like the yen and gold, which had performed well in the six months leading up to the vote, against riskier currencies like the Mexican peso - a play yielding a more th…