For March 2017, Unicorn Macro Fund generated -5.75% net of all fees and expenses and for the year the same. Currently we are long the DJI and short the US 10yr. Please know, we are debating internally whether being away from the market was beneficial, as we made the classic mistake of trading our opinion, rather than the computer models that make up our methodology. We have since reversed our DJI position and sold the US 10yr to be consistent with our methodology.

We are long term bullish on US equities. The US equity markets have been burdened by regulation that the Trump administration is working to remove. In addition, the unwinding of the of the Fed’s balance sheet will end the artificial shortage of bonds resulting in the rotation out of bonds into equities. As long as interest rates stay low the opportunity cost favors equities over bonds even as P/E ratios rise. Once retail investors view their quarterly results they will see losses in their bond funds and gains in their equity funds and that should exacerbate these moves.

We are encouraged the Federal Open Market Committee is planning on unwinding their $4.5 trillion balance sheet while also suggesting halting raising short term interest rates as they unwind. This move will help the US yield curve begin to normalize. Currently, the artificial low long rates, because of quantitative easing, and artificially high short term rates, because of paying interest on excess bank reserves has distorted the yield curve to reflect poor economic growth. However, if the US treasury yield curve were not artificially distorted by the Federal Reserve bank, the US yield curve would be historically steep reflecting strong future growth. This distinction will be important moving forward as some narratives have been pointing to low long rates as an indication the equity markets are overvalued.

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 +52.12% with a Graduated 10% Hurdle Rate
In 2017, Fund performance net of all fees is -5.75% with a Graduated 10% Hurdle Rate

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Disclaimer:

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.