Market Movers – March 2021

Rising sovereign bond yields were once again a major contributor to positive CTA performance during March. Many managers were able to profit from short positions in longer-dated government bonds, particularly in the U.S., as policymakers vouched to maintain accommodative fiscal and monetary policies.

Long-term U.S. government bonds had their worst quarter in four decades, resulting in significant profits for short positions. Successful vaccination programs, an improving economic outlook, and increased fiscal stimulus were the underlying factors that drove yields higher. Not only did the Biden administration’s $1.9 trillion relief bill pass in March but also plans for further stimulus in the form of a $2 trillion infrastructure bill have been announced as well, providing support for positive economic growth. Trend-following strategies benefitted the most from short positions in longer-dated treasuries as managers were able to capitalize on the decline in bond prices starting in January of this year.

 

To send a question to the author, or to learn more about this topic, click here.

For more information about Coquest Advisors and its Portfolios, please click here.

 

Disclosure: The risk of loss in trading futures and/or options is substantial. Past performance is not indicative of future results. The information in this message derived from third-party sources is believed to be accurate and reliable; Coquest does not guarantee the accuracy or completeness of the information. Opinions expressed in this material are subject to change without notice. This report should not be interpreted as a request to engage in any transaction of futures, options, and/or OTC derivatives. The information contained in this material is not to be relied upon in substitution for the exercise of your independent judgment. Seek independent financial, tax, legal, and accounting advice from your own professional advisers, based upon your particular circumstances.

Back