Alt Thinking September 30, 2024
Commentary
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Ninepoint Global Macro Fund (formerly Ninepoint FX Strategy Fund)

Ninepoint Global Macro Fund (formerly Ninepoint FX Strategy Fund)
Investment Team
  • Ninepoint Partners Sub Advised by P/E Global
    Ninepoint Partners Sub Advised by P/E Global
    P/E Investments was founded in 1995 in Boston, Massachusetts by Warren Naphtal, J. Richard Zecher and Mary Stephens Naphtal. As of December 1, 2019, the firm managed approximately US$8.7 billion. P/E’s strategies leverage extensive experience in portfolio management, asset allocation, market analysis and risk management.
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Key Takeaways
  • The U.S. Dollar showed choppy performance, with weakness linked to slowing employment and Federal Reserve rate cuts.
  • Despite recession risks, U.S. growth remains solid, outperforming other global economies, particularly Europe.
  • Yield curve inversion and slowing global growth favor safe-haven currencies like the U.S. Dollar, Japanese Yen, and Swiss Franc.

Effective May 3, 2024, Ninepoint FX Strategy Fund was renamed Ninepoint Global Macro Fund. There are no changes to the investment objectives or strategies of this fund.

Q3 2024 Commentary

Dear Investor,

The investment objective of Ninepoint Global Macro Fund is to generate long-term total returns by investing globally in FX futures on a long/short basis. To achieve the investment objective, the Sub-Advisor will utilize several investment trading methodologies collectively known as the “FX Strategy”, at the standard level of risk to invest in foreign currency futures utilizing a Bayesian statistical model to identify current drivers of currency returns.

The Fund is sub-advised by P/E Global LLC (“P/E” or the “Sub-Advisor”), a private asset management firm providing absolute return strategies, with special emphasis on the global currency markets. Founded in 1995, P/E serves investors worldwide with offices in Boston, MA, Jackson, WY, Singapore, Melbourne, Tokyo and London.  As of October 1, 2024, P/E employed 60+ Individuals, with assets under management of approximately USD $18.9 Billion.

Ninepoint Global Macro Fund (formerly FX Strategy Fund) Monthly Returns (%) Performance as at September 30, 2024- Series F1 (NPP759) | Inception Date: August 6, 2020

Source: Ninepoint Partners

The F1 Class units of the Fund returned net -10.85% (Class F1) for the quarter, bringing year-to-date net returns of 0.06% (Class F1).

Compounded Returns (%) as of September 30, 2024

1M

YTD

3M

6M

1YR

3YR

INCEPTION

Fund

-3.6

0.1

-10.9

-10.9

-11.8

4.7

2.3

During the quarter, U.S. Dollar performance was choppy. Beginning in July, the USD weakened early in the month, and then recovered versus most major currencies by month end. USD weakness resumed in August as U.S. employment showed signs of slowing growth, market participants sold dollars in anticipation of Federal Reserve interest rate cuts.

In September U.S. Dollar weakness continued as the Federal Reserve reduced the U.S. Federal Funds rate by 50 basis points, and signaled that an easing cycle had begun. As of end September, the fixed income markets projected extreme easing over the next twelve months, expectation levels not seen for twenty-five years. This amount of expected easing exceeded both the 2000-2001 period, when the technology stock bubble burst, and the 2007-2008 global financial crisis. While recession in the U.S. may loom, economic data indicates solid U.S. growth on both an absolute basis, and as compared to other global economies. In fact, global growth is slowing elsewhere, especially in Europe.

From a factor perspective, yield curve inversion and slowing global growth indicators increase the probability of risk aversion, which benefits currencies such as the U.S. Dollar, the Japanese Yen and the Swiss Franc. Inflation, while important, has moderated. Looking forward, we continue to hold bearish positions in European and Asia-Pacific currencies, versus those of North America.

Portfolio

As of end of September, the largest positions of the Fund were net negative notional exposures to the Australian Dollar, Euro and British Pound.

Historical Commentary

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  • Commentary
    June 2024
    Ninepoint Global Macro Fund (formerly Ninepoint FX Strategy Fund)
    During the beginning of the quarter, in April, the U.S. Dollar strengthened versus global currencies as continued higher inflation data further reduced market expectations for U.S. Federal Reserve easing. However, during the following month, slightly weaker economic data in the U.S., combined with improving economic expectations for both Europe and Asia, drove some liquidation of U.S. Dollar holdings. 
    Alternative Investments
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All Funds
  • NPP759
    (Series F1)
    Liquid Alternatives
    $12.54 -$0.02 (-0.18%)
    As at 12/3/2024
    Growth of $100,000 Invested as at 11/29/2024
    Performance as at 11/29/2024
    1 Year
    6.82%
    3 Year
    7.41%
    5 Year
    -
    10 Year
    -
    Incept.1
    5.17%
    1 Inception Date 8/6/2020
    Go To Fund

    All returns and fund details are a) based on Series F1 shares; b) net of fees; c) annualized if period is greater than one year; d) as at 10/31/2024. 

    The rate of return is used only to illustrate the effects of the compound growth rate and is not intended to reflect future values of the investment fund or returns on investment in the investment fund.

    The Fund is generally exposed to the following risks: borrowing risk; collateral risk; commodity risk; concentration risk; currency risk; cybersecurity risk; derivatives risk; foreign investment risk; inflation risk; interest rate risk; leverage risk; market risk; performance fee risk; series risk; short selling risk; specific issuer risk; sub-adviser risk; substantial securityholder risk; tax risk.

    Ninepoint Partners LP is the investment manager to a number of funds (collectively, the “Funds”). Commissions, trailing commissions, management fees, performance fees (if any), and other expenses all may be associated with investing in the Funds. Please read the prospectus carefully before investing. The indicated rates of return for series F1 units of the Funds for the period ended 10/31/2024 are based on the historical annual compounded total returns including changes in unit value and reinvestment of all distributions or dividends and do not take into account sales, redemption, distribution or optional charges or income taxes payable by any securityholder that would have reduced returns. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. This communication does not constitute an offer to sell or solicitation to purchase securities of the Funds.

    The information contained herein does not constitute an offer or solicitation by anyone in the United States or in any other jurisdiction in which such an offer or solicitation is not authorized or to any person to whom it is unlawful to make such an offer or solicitation. Prospective investors who are not resident in Canada should contact their financial advisor to determine whether securities of the Fund may be lawfully sold in their jurisdiction.

    Ninepoint Partners LP: Toll Free: 1.866.299.9906. Dealer Services: CIBC Mellon GSSC Record Keeping Services: Toll Free: 1.877.358.0540

Ninepoint Partners LP is the investment manager to the Ninepoint Funds (collectively, the “Funds”). Commissions, trailing commissions, management fees, performance fees (if any), other charges and expenses all may be associated with mutual fund investments. Please read the prospectus carefully before investing. The indicated rate of return for series F1 units of the Fund for the period ended 9/30/2024 is based on the historical annual compounded total return including changes in unit value and reinvestment of all distributions and does not take into account sales, redemption, distribution or optional charges or income taxes payable by any unitholder that would have reduced returns. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. The information contained herein does not constitute an offer or solicitation by anyone in the United States or in any other jurisdiction in which such an offer or solicitation is not authorized or to any person to whom it is unlawful to make such an offer or solicitation. Prospective investors who are not resident in Canada should contact their financial advisor to determine whether securities of the Fund may be lawfully sold in their jurisdiction.

The Fund is generally exposed to the following risks. See the simplified prospectus of the Fund for a description of these risks: Borrowing Risk; Collateral Risk; Commodity Risk; Concentration Risk; Currency Risk; Cybersecurity Risk; Derivatives Risk; Foreign Investment Risk; Inflation Risk; Interest Rate Risk; Leverage Risk; Market Risk; Performance Fee Risk; Series Risk; Short Selling Risk; Specific Issuer Risk; Sub-adviser Risk; Substantial Securityholder Risk; Tax Risk. 

This report is intended for permitted clients (as defined in section 1.1 of Canadian National Instrument 31-103). P/E Global LLC is not registered as an adviser in any province or territory of Canada and, to the extent required under applicable law, intends to rely on an exemption from such registration. P/E Global LLC is regulated by the SEC and the CFTC under U.S. laws, which differ from Canadian laws.

The opinions, estimates and projections (“information”) contained within this report are solely those of Ninepoint Partners LP (“Ninepoint”) and are subject to change without notice. Ninepoint makes every effort to ensure that the information has been derived from sources believed to be reliable and accurate. However, Ninepoint assumes no responsibility for any losses or damages, whether direct or indirect, which arise out of the use of this information. Ninepoint is not under any obligation to update or keep current the information contained herein. The information should not be regarded by recipients as a substitute for the exercise of their own judgment. Please contact your own personal advisor on your particular circumstances.

Views expressed regarding a particular company, security, industry or market sector should not be considered an indication of trading intent of any investment funds managed by Ninepoint Partners LP. These views are not to be considered as investment advice nor should they be considered a recommendation to buy or sell.