April 1, 2021

In the Frame – Issue 3, Investor updates
Managing Director

Frame Futures Fund – Mar 21

Units of the Frame Futures Fund declined by -6.48%. The core strategy detracted -5.65% to performance, whilst the trading strategy detracted -0.83%.

Our equity investments detracted -4.94%. Currency, Fixed Income and Commodity investments also declined by -0.55%, -0.32% and -0.51% respectively.

March could only be described as the month of rotation. Investors rotated out of companies and themes that had performed well over the last 12-months (which therefore may have become extended), and into companies and themes that were relatively cheaper (and who may benefit from rising interest rates). This was illustrated by the divergence in performance between the Dow Jones and the Nasdaq. The Dow finished up 6.62%, whilst at one stage the Nasdaq was down 4.42%.

Our investments in renewable energy, battery materials, technology, cannabis businesses and blockchain technology, were sold off heavily as they were included in this rotation. During March, these investments experienced a period of profit taking and consolidation which detracted from performance by -5.18%. Thankfully, at the time of writing the majority of these names have already rebounded and have surpassed levels seen in February.

Largest contributors to the performance were our investments in the Euro Stoxx 50 future (+0.57%), S&P/ASX 200 future trading (+0.40%) and the US Dollar Index future (+0.33%). Largest detractors to performance, were our investments in China A50 equity markets (-0.67%), blockchain technology companies, as well as battery material/rare earth element producers and explorers.

In terms of fund activity, we took part in the initial public offering (IPO) of Kincora Copper (KCC.AX). This IPO allowed us to gain exposure to promising copper assets in NSW.

At the conclusion of the month, the Fund held 45 investments.