Quadriga Aqua UCITS focuses on:
- Capital preservation.
- High returns in the long term.
- Moderate volatility
These objectives are achieved through the process of rebalancing between two completely uncorrelated strategies: S&P 500 and Quadriga Igneo UCITS.
On the defensive side, antibubble strategies assure positive returns in the case that market collapses. Whilst on the offensive side, returns on the S&P 500 are constantly captured on the way up. There is certain leverage in the strategy that allows for weights of 80% invested in Igneo and 80% in S&P 500 futures. Furthermore, a key element of the strategy lies in the action of rebalancing monthly so that the weights are always 80% / 80%. This way, you assure that you are buying cheap and selling expensive.
Factsheet Aqua – February 2023
What happened during the month?
Quadriga Aqua UCITS is -1,88% in February. Very mixed month where Equities in US saw a huge rally during first couple of weeks to end -2,4% for the month, while European indexes ended positive with Eurostoxx 600 +1,9%. Emeging market equities underpeformed by -7,6% led by the Hang Seng -9,41%. Meanwhile, bonds retreatred on new inflation fears by -3,27% in 10y and -4,85% on long end (20+ years). This pushed down precious metals significantly, with gold -5,28% and silver -12,25%. Market is back to higher for longer interest rates after inflation numbers surprised to the upside both in Europe and America, which drove up inflation expectations for the next 2-5y significantly higher. Some macro numbers came better than expected, like PMIs although still in negative territory. We think leading indicators are showing a harder landing than the bond and equity markets are discounting, together with highest ever corporate margins, excesively optimistic EPS expectations, the change in the mindset of Central Banks from two decades of “deflation fear” into “inflation fear”, and the still high valuation of equities when compared to real interest rates, posing a great risk to equity and credit markets going forward. So we keep actively covering our risk in the long SPX position.