“You heard it here first,” is becoming increasingly relevant here at HR.
That doesn’t necessarily mean we’re over here cooking up scoops and exclusives, but what it does mean is that when it comes to putting the pieces together and saying: “here goddammit, this is what all of this means,” we’re quickly becoming second to none.
On Thursday, in “‘What You Got Was The Exact Opposite’: Macro Hedge Funds Join The ‘Dumb’ Money,” we wrote that macro hedge funds, stinging from underperformance associated with a wrong-way bet on a continuation of the Trump-inspired long USD, short USTs trade, have essentially thrown in the towel and joined “Sharon“.
That is, “if you can’t beat ‘Sharon’, you might as well join ‘Sharon’” onboard the “all-in equity” bandwagon. Here’s what that looks like, courtesy of Nordea’s Martin Enlund:
Macro hedge funds’ total return down by ~1% since 1-March, and still all-in equities pic.twitter.com/onvYmCoA9G
— Martin Enlund (@enlundm) March 8, 2017
As we also pointed out, macro hedge funds aren’t the only strategy that’s struggling to outperform a simple “buy SPY and forget it” approach YTD. Here’s a cross-strat snapshot:
(Goldman)
Well as it turns out, saying “f*ck it, let’s just ride the S&P wave” trade has been going on for quite some time. And understandably so. It’s kind of hard to outperform a benchmark that’s staged a goddamn 8-year rally. Here’s Goldman:
Yesterday marked the 8th anniversary of the current bull market, making it the second-longest on record. On March 9, 2009, the S&P 500 index traded at 677 and it now stands at 2365, reflecting a price gain of 250% or 17% annualized (19% annualized with dividends). Happy Birthday indeed!
Yes, “indeed.”
