Purpose International Tactical Hedged Equity Fund March Commentary

Fund Highlights

  • The Fund was slightly positive for the month as global markets regained some of their losses from a steep sell off in February.
  • Equities were positive in all regions with British and Australian equities providing the best returns.
  • Most returns were offset by equity futures hedges as the market broke the downwards trend being followed by the strategy. Equity hedges were especially detractive in Japan and Asia-Developed, offsetting positive equity returns.
  • The month started off with all equity hedge positions almost at allowable maximums, but these positions were mostly reduced to allow for more upside potential during the month.

Market Commentary
Markets retraced higher in March with the S&P recovering almost all its year to date losses. Oil bounced off the lows in anticipation of a meeting between OPEC and non-OPEC nations to discuss production freezes. US employment numbers continued to see strength which bolstered the argument for further Fed hikes this year, however Yellen surprised the market taking an abrupt dovish turn while citing recent financial developments in her reluctance to tighten further. As a result, the US dollar sold off broadly, credit tightened and risk assets rallied. In Canada, a poor jobs number was offset by an upward surprises to retail sales and GDP. The government also announced a budget deficit plan which would include a large infrastructure spending program aimed at stimulating more growth.

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