Purpose Multi-Strategy Market Neutral Fund March Commentary

Fund Highlights

  • Mixed performance in March as the Fund continues to maintain its market neutral characteristics with very low volatility. The equity and currency sleeve contributed positively to Fund performance whereas commodities made a negative impact.
  • The U.S. equity sleeve was positive as the value tilt of securities really came in to play in March with the Russell 1000 Value Index outperforming the Russell 1000 Growth index by +54bps. International equity positions remained largely flat as significant equity hedges were maintained in international markets.
  • The currency sleeve was slightly positive with mixed results as carbon-currencies rallied on WTI crude oil (+13.6%).
  • The commodity sleeve was slightly negative due to numerous short positions on energy commodities. These were largely offset by overweight energy positions in the equity sleeve.
  • The Fund replaced 1 U.S. equity in March and removed 1 long and 1 short position in the commodity sleeve, bringing the total number of commodity longs and shorts to 5 each.

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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