For both the small and hedge fund portfolios, I have decided to use gold (GLD) for the currency asset class exclusively. Thus the short position in UUP will be closed when the market opens tomorrow. New long positions are:
My reasoning for the switch is that gold is a proxy for people’s confidence in all fiat currencies, not just the US$. The US$ index is an antiquated trade weighted basket of other fiat currencies and thus measures relative strengths of equally flawed currencies.
For the month of February, the small portfolio was up 3.1%, the hedge fund portfolio was up 2.8%. Annualized performance is 13% (with 5.88% drawdown) and 12.9% (5.75% drawdown) for the small and hedge fund portfolios respectively.
Note that in a previous post, I said that I would discontinue the small portfolio. I have since changed my mind (thus the temporary name change on collective2).