Fortem Capital Alternative Growth Fund

UK & EU – For professional and institutional investors only
Switzerland – this is an advertising document for professional and institutional clients as defined by the Swiss Financial Services Act only

Monthly Commentary – 30th November 2021

After a number of month’s in which COVID newsflow was muted, much to the benefit of risk assets, November was dominated first by increased infections in Europe and then the emergence of a new variant of concern; Omicron. In Europe, it was notable that hospitalisations increased more in those countries in which vaccine take up has been lower. It remains too early to tell whether the new variant significantly reduces the effectiveness of vaccines, but the early signs are encouraging on this front and early data suggests that although the variant is highly transmissible, it is relatively mild.

Inflation remained stubbornly high over the month; US CPI rose 6.2% from a year earlier in October. The perception that any further lockdowns may cause further supply chain disruption has meant that bond markets have been fairly erratic, yields fell heavily on the news of the new variant, before rising at the front end as it was suggested that there may be an acceleration in the US taper in spite of this.

The Fund increased by 0.9% over the month.

There were positive contributions from the majority of strategies.

The Fund’s long rates volatility strategies benefitted from heightened volatility in bond markets as investors grappled with inflation and the new variant. The risks to the bond market have been discussed often and at length, but perhaps what is likely, irrespective of the overall journey of travel for the bond market, is that there will be continued volatility along the way.

It was a positive month for the Fund’s commodity strategies which benefitted from some weakness in energy prices at the front of the curve. There was an element of this stemming from a move in oil timespreads as a result of the new variant, but the bigger impact came from a reversal of the moves seen in Natural Gas in September and October. In spite of the weakness in November, 75% of BCOM still remains in backwardation, suggesting there is still plenty to come from the strategies.

Total Return 2021 Nov
UK 100 13.0% -2.2%
US 500 22.7% -0.7%
Europe 50 16.6% -4.3%
Japan 225 2.6% -3.7%
Hong Kong 50 -11.7% -7.4%
US 2000 12.3% -4.2%
Swiss 30 16.9% 0.4%
BCOM 22.7% -7.3%
US Treasury -1.3% 0.3%
FTSE EPRA 23.6% 3.2%
PGF 6.0% -1.3%
AGF -0.5% 0.9%
Real Estate 20.1% 0.9%
US Equity Income n/a -0.8%


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