MAXIN GLOBAL FUND - USD is a Long / Short Directional hedge Fund incorporated in Luxembourg. It started trading on February,22 2022 and replaces MAXIN ADVISORS' MODEL PORTFOLIO which has been trading since January 1st 2014. At MAXIN ADVISORS, we manage FULLY TRANSPARENTLY and publish the transactions on a DAILY basis and the details of the portfolio on a WEEKLY basis.
MAXIN GLOBAL FUND / MODEL PORTFOLIO
Gross Performance
– 0.04 % Last Week
+ 1.24 % Month to Date
– 5.92 % Year to Date
+ 1’008.96 % Since Inception
+ 29.71 % Per Annum CAGR 9.2 Years
NAV 1108.96 ( Base 100 )
MAXIN GLOBAL FUND – USD Standard Class C
Net Performance
Manager’s Comments
In a week of extreme volatility that saw the western world rocked by the most serious crisis of confidence in its own financial system since JP Morgan’s era and European equity markets finally breaking down from their irrational levitation, our highly diversified portfolio remained flat while we turned our risk exposure significantly.
During the week, we took signifiant profits on our US and European equities short positions and our long volatility positions accumulated over the previous weeks. We increased our exposure to Chinese equities, took profits on Gold and Silver, were stoped out of our long position in Oil, were stopped out and reversed our positions in US tech and cryptos and finally took some profits on our long bond positions while accumulating some deeply discounted European and US shares.
The week was marked by the aftermath tremors of the US banking crisis of the previous week, the panic over CREDIT SUISSE, the European Central Bank doing the right thing in raising rates by 50 basis points as planned and by a major reversal in US technological stocks.
The Western World and global investors are finally taking the measure of the systemic imbalances that have accumulated in their economies over the past decade of highly toxic unorthodox monetary and fiscal policies.
Panic is setting in and it may not be over, despite the drastic measures taken by Governments in the US and Switzerland to restore confidence.
Interestingly enough, US equities actually ended the week up with the Nasdaq and technology stocks breaking out of their downtrend. As disciplined investors, we took our profits on most of our shorts and went long the Nasdaq, GOOGL, AMZN and NFLX while adding to smaller special situations.
Volatility surged on Monday, Tuesday and Wednesday, and we took major profits on the long positions we had accumulated there, keeping some in case of a retest of the downside that we expect next week at the time of the FED meeting.
But the week really crushed European equity markets with the EUROSTOXX50 losing almost 4 %, We had been warning investors that Europe was the next shoe to drop and our strategic shorts in luxury, engineering and insurance sector marked a major secular top.
Being disciplined investors, we took profits on our index short positions at the support technical levels as well as in some individual positions. Conversely, we added to our position in CREDIT SUISSE as our assessment of the situation is that we have seen the worst of the decline and that theirs reward ratio has become favourable. CS is too big to fail and its assets are worth far more than its current market capitalisation. With the SNB’s 50 Billion lifeline and major banks ready to acquire some of its assets, CREDIT SUISSE will not default and shareholders will not be wiped out as some seems to fear.
But the most important shift is really into Chinese equities where we have added numerous individual positions as well as exposure to the indexes, taking our total exposure there to 70% of our portfolio.
Global investors are now finally realising that China has none of the systemic imbalances of the Western economies and is growing again with low inflation at a time where the rest of the world is bound to enter a sharp recession with high inflation and interest rates. They are also realising that the Chinese banking system may actually be far safer than the Western banking system that will have to live for years with the threat of unrealised losses on their massive bond portfolios, in addition to the looming real estate crisis.
As we argue in our Weekly Market Review this week TIME HAS COME TO SHIFT GLOBAL PORTFOLIOS TO CHINA strategically. Assets are cheap, inflation is low, monetary policy is accommodative, a new and solid team is at the helm, real estate is growing again and the economy is powering ahead through domestic consumption.
We have further diversified our portfolio into individual stocks on their own merits, adding to brokers, autos, real estate, consumer goods, shipping, cement, solar and consumer oriented smaller caps.
From a global perspective, next week’s FED meeting will be a crucial event and we expect the FED to raise rates by 0.25% as planned. We may be wrong, but any weakness by the Fed in its fight against inflation could actually send bond markets tanking, a very negative development for equities.
We see US equities testing the 3808 level on the SP500 or slightly below again, before rising towards 4050 / 4150 into April before marking a lower high and starting the next down leg. In this rebound, technology stocks will take the lead, while industrials, staples and financials will continue to weaken. Beyond April, the environment will become highly negative for equities.
European equities are deeply oversold but will rebound far less.
We can obviously not exclude a widening of the panicky state of the markets and other runs of regional and niche banks. A sign of this is the worrying reversal of Cryptos where investors are moving cash out of banks and into Bitcoins and we have gone long the token. The other worrying sign is the breakout of Gold above 1950 on Friday testifying of the same level of panic.
We stand ready to re-instate our short positions on a break below the 3800 level, or will wait for the rebound to sell again higher up.
China is on the verge of a major change of trend and any catalyst will send their equities higher.
As the risk metrics below show, our diversified positioning and active trading has delivered far better Sharpe and Sortino ratios than the market in March and we believe that will continue to be the case going into the month end.
Risk Metrics and Performance Contribution
Portfolio Details
New Asset Allocation
Transaction List
Week Ending 18 Mar 2023
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