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Bailey McCann, Opalesque New York: September's interest rate cuts by the Federal Reserve could turn out to be beneficial for some fund managers. Trident Capital Management said in a recent investor letter that the rate cuts could be positive for global macro strategies.
"Typically, we do our best when the Fed is active because the persistent change in interest rates drives persistent and, for us, predictable change across all markets," the letter said.
The Trident Futures Fund, a systematic global macro fund which launched in January 2019, is managed by noted systematic trader Jay Feuerstein.
Both share classes in the Futures Fund have done well in recent months. The Global Macro and Global Macro Enhanced share classes were up 0.4% and 0.5% in August, respectively.
Global macro strategies overall tend to do better when there is a lot of dispersion across asset classes. Trident's funds run on three proprietary trading models: Vega, RR, and the Engle model which use measures of market volatility and risk appetite to add stability and consistency to Trident's portfolio. These models are meant to be valuable in times of crisis by either being "short" equity or "long" fixed income, or both. The models work in concert depending on how markets are behaving at any given time. Individual models may turn on or off based on market signals.
The strategy is the latest outgrowth of Feuerstein's work in systematic trading. Prior to launching Trident, F...................... To view our full article Click here
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