As the Yen begins to stabilize, the Japanese equity markets are less of a concern on the downside and might begin to show strength as the US markets continue to strengthen. The Yen weakness comes at the cost of the EuroYen rather than the US$, as both the Fed and Treasury still believe in a weaker US$. Politics in the form of isolationism and the belief the Fed will tighten will affect the behavior of the US$ in the near future. Any US$ weakness will put downward pressure on Japanese and European equity markets and possibly the US. If the US$ can stabilize and possibly strengthen, this will stabilize Japanese and European equity markets and enable the US equity markets to continue to strengthen relative to long term interest rates. If the Fed decides to artificially raise interest rates further rather than allowing for the natural equilibrium rate in Fed Funds, the monetary impact will be deflationary putting the US economy and US asset prices at risk.
Early morning Thursday, September 29th, on the close, we bought back our Japanese Nikkei short at an equivalent index price of 16,695. Currently, we are long the S&P and Euro$.
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 +34.41% 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.