Hedge Fund - Macro strategy
The Hedge Fund Macro strategy involves taking positions in various asset classes, including currencies, bonds, equities,
and commodities, based on fundamental and qualitative judgments. Here are the sub-strategies within this category:
Hedge Fund Macro Sub - Strategy:
Fixed Income Relative Value
Generates profits from relative movements across fixed income assets and derivatives.
Seeks to profit from arbitrage, mean-reversion, or positive carry.
Often aims to be duration or risk-neutral, with some use of leverage.
Example: A FIRV macro fund identifies a mispricing between two similar fixed income securities and takes long and
short positions to exploit the price difference, aiming to profit as the prices converge.
Commodities
Focuses on trading commodity futures and options, with occasional use of equities, currencies, or fixed income
instruments.
Looks for longer-term trends and supply/demand imbalances within and between commodity markets.
Example: A commodities macro fund analyzes supply disruptions in the oil market and takes long positions in oil
futures, anticipating a price increase due to reduced supply.
Global Macro
Takes positions in currencies, bonds, equities, and commodities based on top-down views of the world.
Investment decisions can be driven by macroeconomic factors such as interest rates, inflation, government
policies, or geopolitical events.
Focuses on liquid instruments of G10 countries, with potential exposure to emerging markets.
Example: A global macro fund predicts an economic slowdown in Europe and takes short positions in European
equities and the euro, while going long on safe-haven assets like US treasuries.
Emerging Markets (EM)
Takes positions in currencies, bonds, equities, and commodities primarily focused on emerging markets.
Investment decisions consider factors specific to emerging economies, such as growth prospects, political
stability, and currency movements.
Example: An emerging markets macro fund anticipates a currency devaluation in a particular emerging market
country due to political instability and takes short positions in the country's currency and bonds.
1 Year Return and its comparison with Equity, Bond, and Hedge Fund Composite Index
5 Year Return and its comparison with Equity, Bond, and Hedge Fund Composite Index
