Net assets decreased $ 10,772,049 for the three months ended September 30, 2024. This decrease was attributable to subscriptions in the amount of $ 0, redemptions in the amount of $ 1,866,034 and a net loss from operations of $ 8,906,015.
Management Fees of $ 606,368 and servicing fees of $ 202,724 were paid or accrued, and interest of $ 1,077,401 was earned or accrued on the Partnership’s share of the Trading Company’s cash and cash equivalent investments and broker balances, for the three months ended September 30, 2024.
The Partnership’s other expenses paid or accrued for the three months ended September 30, 2024 were $ 325,855.
In July, the Partnership returned negative net of fees, driven by losses in currencies and fixed income. A net long US dollar overall position was not profitable, while the Partnership’s short yen position against the US dollar was also unprofitable, however, the Partnership’s position in Sterling against a basket of currencies led to some offsetting gains. The Partnership’s fixed income losses were concentrated at the short end of the curve as increased rate cut expectations hurt positions in Euribor and SOFR. Further out the maturity spectrum, European bond positions generated the biggest losses, flipping from short to long in the process. Within commodities, trading in agricultural generated gains, most notably from short soybeans position, while energies trading was broadly flat, with gains from short US natural gas being offset by losses from long oil positions. Within metals, longs in both silver and copper detracted. Long positions in risk assets scraped a positive return. In Japan, indices fell and long positions in Taiwanese indices suffered in sympathy with falls in the Magnificent 7. Gains from longs in Canadian and Australian indices offset these losses. Credit trading pipped equities for top performance on the month, led by long positions in high-yielding names in the US and Europe.
The Partnership ended August down on the month, driven by losses in stocks and currencies. Risk assets bore the brunt of August’s early reversal, with tempered exposures unable to fully recover losses amid the subsequent market rally. Long Asian indices were particularly affected, with Japanese stocks seeing their largest daily loss since 1987. Elsewhere, long US small caps and European indices compounded declines. As credit spreads widened, the Partnership’s long high yield exposure lead to declines. Forex trading dragged on performance amid a softening US dollar, particularly against Asian currencies, where short exposure to the Korean won and Chinese renminbi drove declines. The US dollar weakening hurt the Partnership’s net long US dollar positioning, however long Sterling helped offset as the pound hit a two-year high against the US dollar. Fixed income losses were concentrated at the short end of the curve with the Partnership only just switching to net long amid the early August rout, which suffered later in the month. Performance was mixed further out the maturity spectrum, with long Japanese bonds generating notable declines. In commodities, losses stemmed from metals and energies trading, notably short aluminum. Similarly, oil uprooted market price expectations with long positions falling on curbed Chinese demand and rising inventory levels. Agricultural trading partially offset losses as coffee surged.
In September, the Partnership returned positive net of fees, with positive attributions from fixed income, FX, equity, and metals trading, offset by losses from agricultural and energies. The Partnership’s transition to long fixed income over the quarter was rewarded as yields declined across most regions and tenors. Top performers were Italian bonds. A loss was incurred in Gilts, while a decreasing US dollar lead to gains in currency pairs such as the South African rand and British pound. Losses were incurred from a long position in the Chilean peso against the US dollar, however, as the Chilean central bank cut rates but gave dovish forward guidance. Top performers within equities were longs in the MSCI EM index and Hang Seng, while a loss was made from a short in the FTSE China A50 index. Long credit positions were all beneficial, most notably in high yielding CDS indices on both sides of the Atlantic. Trading in commodities was mixed. A declining US dollar and falling rates were positive for longs in precious metals. A short US natural gas position was hurt as prices rose. Within agricultural, returns were quite disparate; a long in coffee was beneficial, while losses were seen in the soy complex.
Three months ended June 30, 2024:
In April, the Partnership generated a positive return, with gains from fixed income, FX and commodities offsetting losses from equities. The Partnership’s short fixed income positions were largely profitable, though losses were experienced trading Japanese bond futures. The Partnership’s net long US dollar positions performed well against a variety of currencies, specifically, the Japanese Yen, while a short position in the US dollar against the Mexican Peso generated a loss. Within commodities, metals did the best, with long positions in copper and gold generating positive returns. Returns from trading agricultural were more muted, with losses from a short wheat position offset by gains from long coffee. Energies trading generated losses from short US natural gas, long gas oil and short carbon emissions. The Partnership’s long equity positions generally experienced losses this month, though there were certain exceptions, including a long position in the FTSE100 index. Long credit positions also generated losses, with the US and EU higher-yielding names faring worst.
In May, the Partnership generated a negative return net of fees, with losses in FX, commodities and bonds outweighing gains from equities and credit. In FX trading, the Partnership’s broad net long US dollar positioning, most notably against the Swiss franc and Norwegian krone incurred losses. Japan’s yen rose, generating losses, but were mostly recovered as it fell back again as the month progressed. Commodities trading also generated losses, though there was variation across sub-sectors. Energies did the worst, with the Partnership’s short in US natural gas being one of the worst performers. Within agricultural, short positions across the soy complex