Results of Funds and Strategies for January 2025
Andrei Movchan
Feb 19, 2025IT DOESN'T CONCERN US
Well, yesterday my furniture supplier from Australia solemnly informed me that the factory resumed work after the New Year holidays — Down Under, it turns out, the Chinese New Year is celebrated more widely than the European one. Now we can consider that the year has truly begun.
Meanwhile, according to the calendar, 36 days of 2025 have already passed — to be precise, that's 10%. The year is in full swing.
The year is in full swing, but our recent attempt to record the traditional dialogue between me, Eugenio, Elena, and Artem about changes in macroeconomics since the beginning of January didn't start well — Eugenio's opening speech took only 12 minutes; this meant he had absolutely nothing to say. There was nothing for the others to say either, and after struggling for another 20 minutes, stretching everything possible, including Trump's tariff policy, we parted ways. There have been no macroeconomic changes in the world since the New Year — none at all!
The world is seething, the new old American president is issuing decrees that bring tears to economists and politicians accustomed to the old rules, institutions and doctrines are collapsing in the West, facts of corruption are being uncovered that would make Latin American caudillos, African dictators, and Russian officials envious, everyone is expecting a world trade war (at least a local one in the Middle East, but a hot one); my acquaintances, those who are more anxious, don't know what to protect themselves from first — from the expropriation of all funds by regulators, from hyperinflation and a crisis in the US, or from the nuclear threat — and the markets, it seems, haven't heard about any of this.
In January, the S&P 500 habitually grew by 2.78% (I understand that for my readers accustomed to the growth of the S&P 500, this figure doesn't seem large, but actually, it's above the average growth rate in 2024!) and (which is unusual) the global index excluding the US grew even more — by 4%. High-risk bonds are also not lagging behind — HYG showed a growth of 1.36%. It would seem that spreads are already minimal, but they are becoming even smaller. The celebration continued almost until January 31, then the markets froze in anticipation and as of February 12, they are still in this state (S&P 500 is in the same place, NASDAQ is 0.6% higher, HYG is 0.3% lower), but the groundwork for the year has already been laid. Whatever happens in the world, the markets seem to say: "It doesn't concern us"; but that's just the shell, the indices. Inside the markets, storms are raging: Tesla has fallen by 19% since the beginning of the year; Alibaba has risen by 32%; Bitcoin went up and down by 20% to return to the January 1 level today. What's the reason for this? We've discussed many times what it is — a large volume of irrational actions by market participants amid the ongoing influx of liquidity. Can we use this? Unfortunately, no.
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For Movchans’ Group products, January turned out to be more boring than we would like — third-party fund portfolios are re-evaluated with a month's delay, and the January results included a re-evaluation for a depressive December.
ARGO SP showed an increase of 0.25–0.35%, "returning" about 40bps out of the average 120bps (1.2%) advantage achieved over the markets in December. Considering the excellent January for our fund portfolio, we expect strong results from ARGO SP in February and further growth of the gap from the benchmarks.
GEIST SP: showing a rather modest increase of 0.11–0.16%, the fund gave back 2.5 out of 3.5% to the S&P 500, won in December; well — over 2 months plus 1% to the most difficult-to-achieve index. And GEIST SP still has the results of the fund portfolio for January in reserve, which, judging by everything, will be good.
LAIF SP brought investors from 0.44 to 0.6% in January; we are still waiting for volatility to grow, but it still doesn't grow, but 5.3–7.2% per annum (which is the return LAIF SP showed for January in recalculation) — this is a result that should satisfy our investors.
ARQ SP rose by 0.46–0.55%. And although this is not a bad growth, and although I keep repeating that short-term results for this fund do not matter, I cannot help but share the "problem": a lot of new money is coming into the fund and we simply did not have time to invest it in January. By the end of February, this situation will be resolved and the fund will return to a normal portfolio composition, and for us, it will be a lesson: we need to prepare opportunities for a growing fund in advance.
Cossack fund continues to please investors with good results: +1.03% for January. This does not look like an incredible success against the backdrop of the growth of risky paper indices, but it is an excellent indicator, considering how much lower the fund's volatility is compared to the benchmarks.
FISTR showed a 0.44–0.45% increase and, it seems, the good results of this, in general, very conservative and limited in opportunities strategy are becoming more of a rule.
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February began with a stagnation in the markets, but with good growth in all our funds. The world, freed from celebrations, is fully immersed in business routine (in the time free from discussing politics, of course). Many processes that are just beginning will be more obvious and understandable in a month — and I will definitely tell you about them in the next letter.
Meanwhile, we continue to manage our funds and your (and our own) investments and wish you and us successful investment decisions, good markets, more predictability, safety, efficiency, and, of course, joy from the approaching spring. See you in mid-March!
