The Mosaic Global Fund’s estimated performance for the month of August is -2.39%, which brings the estimated year to date return to 0.25%.
Over the course of the last few months, quantitative easing and potential “tapering” of Central Banks globally have been in focus as we have been writing about in previous monthly commentaries. This changed somewhat in August, with more focus on geopolitical tension. The situation in Syria played a major role in this shift pushing energy-related investments higher.
Due to the increased uncertainty, investors became more risk adverse, subsequently stock markets sold off during the month. Gold and silver had a strong month, while bond markets continued to be weak. The Fund lost money in our equity positions and our trend following holdings, whilst our hedge fund positions generated positive returns. The Fund has dramatically reduced its equity position during the month due to the weakness of stock markets and has instead substantially increased our commodity exposure as well as allocated capital towards various currencies that are showing strength.
New Techniques Implemented
As we mentioned in our latest commentary, over the last few months we implemented a Trend Filter and a Momentum Filter into our allocation framework. The Trend Filter helps us to evaluate our whole investment universe (120+ asset classes/markets) to make sure that we are only invested in markets which are in a positive trend. A perfect practical example of this principle is the substantial reduction of equities in our portfolio since our Trend Filter is signaling a current weakness in equity markets.
Our next step after establishing assets / markets are in positive trends is that we finally rank which asset classes and markets are currently the strongest with the help of our Momentum Filter. We deploy capital based on a short list of investments that meet our criteria.
We received a lot of positive feedback from many of our readers about the new our new techniques. For those of you that we haven’t yet spoken with, we encourage you to get in touch to find out more about how we help your client’s protect their assets and at the same time extract performance from global markets.
For a personal meeting or phone call, please reply to this email or send me an email at: firstname.lastname@example.org. We look forward to speaking with you shortly.
To your investment success!
Per-Olov Jansson and the Cardea Investment Team – www.cardeainternational.com