You would be forgiven for thinking that January was the longest month, ever. Yet, we made it through another lockdown, closed beaches, and even the booze ban. The upside was a renewed focus by policy makers to buttress the recovery by keeping rates low and liquidity ample. While the year got off to a mixed start across and within asset classes, risky assets and commodity prices generally fared well.
With the rate of Covid-19 infections again manageable, we are experiencing increased mobility, a demand revival, and, importantly, the full reopening of schools. In addition, after some delay and a few glitches (thanks to the more infectious strain), South Africa has finally started its vaccine rollout, putting us more clearly on the road to recovery. Does that mean we should be more bullish?
Well, as luck would have it, this month the rat passed the baton to the ox in the Chinese zodiac. Yes, we know, an ox is technically not a bull, but it is nevertheless symbolic. Moreover, the elemental phase in 2020 and in 2021 is metal – again rather apt given the 35% average increase in dollar metals prices over the past year; 9% for the month to date. No wonder the rand has been so resilient in the face of SA’s fiscal mess, policy uncertainty, and more recently, rising global yields. Even the US bond market has embraced the reflation trade, with the 10-year yield more than doubling over the past six months.
Traits associated with the year of the ox are diligence, dependability, and determination. These are very much characteristics one would look for in an investment manager. While we would never invest according to astrology, we hope that your stars align in the year of the metal ox!
- Level 2 B-BBEE contributor
- Matrix NCIS Fixed Income Retail Hedge Fund 1Y return of 30% till end January 2021
- Matrix SCI SA Equity Fund ranks number 9 out of 109 funds in the General Equity space since inception.
- Amplify SCI Defensive Balanced Fund ranks number 1 out of 81 funds in the Multi Asset Low Equity space since inception.
- Matrix NCIS Fixed Income Retail Hedge Fund has returned Cash+10.6% since inception.
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