December 15, 2022

In the Frame - Issue 21, A message from Hue
Managing Director

A message from Hue: What I saw in November 2022

November ended with some significant trend reversals across all asset classes, as officials from the US Federal Reserve hinted that they may decide to slow the pace of rate increases sooner, rather than later. This change in communication had been brewing for a few weeks and most markets saw reversals. The S&P ASX 200 rose 6%, while the Nasdaq, S&P 500 and Dow Jones all finished up over 5%. 30-year US treasury yields dropped, while the US Dollar Index experienced a -4.95% decline. 

Interest rate increases 

During November, we saw most global central banks increase interest rates further. Australia increased rates by 0.25%, while the US, UK and NZ all increased rates by 0.75%. This brought their rates to 4.00%, 3.00% and 4.25% respectively.


Investors should not have been surprised to see stock markets rally during November. Over the last 20 years, November has been the second strongest month of the year for the S&P 500, with an average gain of 1.8%, while being positive 75% of the time. 


As talk of a potential Fed pivot gained traction among investors, the renewed optimism resulted in one of the largest outlier-moves in the history of the S&P 500. On the 10th November it rose 5.5%, its largest one day gain since 2020, an increase of over 3.5 standard deviations. 

Portfolio performance . During November, both strategies continued to be defensive. The Frame Futures Fund – Class 1F declined by -0.16%. The Long Short Australian Equity strategy declined by -0.212%. 


Top equity contributors for the Frame Long Short Australian Equity Fund (FLSAEF) were AMP Ltd (ASX: AMP), Mineral Resources (ASX: MIN) and Computershare Ltd (ASX: CPU). Largest detractors were Allkem Ltd (ASX: AKE), Ramelius Resources Ltd (ASX: RMS) and Perpetual Ltd (ASX: PPT).

For the Frame Futures Fund, largest contributors to performance were investments in soybean oil, lean hogs and US 30-year treasury bond futures. Largest detractors were investments in cotton, canola and live cattle futures. 

Coming up 

Through-out December and January, we will be reaching out to current and future investors to provide updates on Frame Funds Management and our recent strategy development work. There have been many exciting developments on both a corporate and strategy level which we will communicate to everyone. 

If you are heading away and plan to be unreachable, please call our office on 02 8668 4877 to schedule a call. 

If we don’t speak prior to the holiday break, I would like to wish all investors and followers a Merry Christmas and a Happy New Year, and we look forward to speaking to you in January

If you would like to discuss any of these points, please email me at or call our office at 02 8668 4877.

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