Investors aren’t limited to only investing in the S&P 500 and the Dow Jones Industrial Average. Every week we share the market trends we are following. We are interested in whether the trends in those markets are continuing or if they are experiencing a temporary or complete reversal.
When we identify trends, we are only concerned about the price data and what it says about any given market. We don’t need to know why a trend has formed to invest, but our human nature wants to understand what is driving them. Each week we try to offer some perspective on what we think the most substantial moves are and what critical drivers are behind them. Here we look at what is going in our globally diversified, non-correlated Crystal Bay Ubitrend strategy.
Last week’s continuing trends:
- UK Gilts
- Canadian and US Government Bonds
- Oats
- Gold
Last week’s reversing trends:
- Rice
- German and Japanese Government Bonds
- Orange Juice
- Chinese Renminbi
What we are taking note of:
US equity markets hit a bump and ended the week down. Government bonds and gold went up.
The range between the pre-pandemic peak and the post-pandemic bottom is extremely wide, not only for equities but for all macro-sensitive instruments. Meaningful trends will not be established until we leave this range (whether up or down) or until enough time passes by so that the extreme swings of March are no longer relevant.
How are we heading into next week?
The Crystal Bay Ubitrend portfolio remains unusually underleveraged, with volatility well below target. It has plenty of dry powder to deploy.
Rates remain the biggest sector by far, followed by agriculture. Metals and energy have only one position each and there are no positions in equities or currencies.