The first quarter was a pleasant one for investors. It was difficult not to make money on the long side in equities, while it remained slim pickings for bears. Bonds and credit rallied too, albeit less vigorously, and commodities also pushed ahead. The USD-bull story, however, fell by the wayside. My two first charts put some numbers to this. The first shows the total return-to-date for the main asset classes, and the second adjusts for volatility. Equities did the heavy lifting—with EM on top and Japan trailing—but the 8.2% jump in gold is also interesting. Not many have really talked about this, but it has benefited the portfolio in an environment where its core equity positions has been left behind by roaring benchmark indices. High yield credit in the U.S. has also pushed higher without much ado, while commodities have trailed. U.S. govvies have underperformed although, the 10-year bond reasserted itself towards the end of the quarter. Finally, king dollar was demoted to Jester.
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