We are concerned the central banks are acting independently as the markets begin to challenge them. We hedged-up our US positions to protect against a positive comment coming out of the Fed or during Janet Yellen’s press conference tomorrow. Other than normalization of the Fed’s balance sheet we do not expect any positive comments, nevertheless it is prudent to protect some profits. We continue to believe the Fed must allow a stronger US$ to stimulate global growth and to keep short term interest rates low to stimulate the domestic economy. Barring a normalization of the long end of the curve we continue to be quite bearish.
Tuesday morning, June 14th we bought the S&P at an equivalent index price of 2068 to hedge our short position in a synthetic option and sold the US 10yr note at equivalent yield of 1.58% in a synthetic option, yields move in opposite direction of price. Currently, we are long $Yen, short the German Dax, hedged in the S&P bias to the short side and hedged in the US 10yr note bias slightly long. We are currently 57% invested.
In 2012 modeled performance (7 ˝ mo.) net of all fees was +12.46% with a 10% Hurdle rate
In 2013, modeled performance net of all fees was +19.73% with a 10% Hurdle rate
In 2014, modeled performance net of all fees was +56.42% with a 10% Hurdle rate
In 2015, modeled performance net of all fees is +72.68% with an 8% Hurdle rate
In 2016, modeled performance net of all fees is +45.90% with a Graduated 10% Hurdle Rate
The Unicorn Macro Fund, LP (“Fund”) operates under the SEC rules of 506(c) of Regulation D. This rule allows general solicitation as long as all purchasers of the Fund are accredited investors and the Fund takes reasonable steps to verify that purchasers are accredited investors. The 506(c) rule benefits funds that perform better than their peers, because for the first time, Regulation D funds can post their results publicly.
The Fund trades both long and short positions in a variety of global markets and its performance is not correlated to any one market. Performance of the model of the Fund is measured by Net Asset Value (NAV) which is net of all fees, is unaudited, and may include the use of estimates. Individual results will vary based on the timing of an investment and past performance is no guarantee of future results and there is a possibility of loss.
The modeled results are based only on capital appreciation from macro style trades. The results do not include dividend reinvestment or any other form of cash flow and are taxed as ordinary income. All trades have a risk/reward objective of at least 3 to 1 and each full position risks no more than 2% of assets. There will be times when market conditions may alter these objectives. Since the inception of the model our trading of the methodology has become more precise.