MacNicol’s The Alternative Asset Trust Quarterly Commentary- April 2022

The MacNicol Alternative Asset Trust is a multi-strategy, alternative investment platform designed to generate returns that are positive and uncorrelated with public stock or bond markets. The Trust, through its underlying limited partnerships invests in real estate, private equity, and hedge funds. In total the Alternative Trust is invested in more than 150 separate real estate projects, private businesses, and hedge funds. The advantages of our approach to alternative assets include effective diversification, enhanced liquidity and a less volatile return profile compared to the individual asset classes themselves.

Alternative Trust Update: The goals of the Alternative Trust are to generate attractive risk-adjusted returns and help diversify portfolios of public market investments. During the 1st quarter of 2022 the Trust was higher by 1.34% bringing the annualized return since inception to 10.24% per year net of all fees and expenses. During the quarter, the Trust provided stability when the world around it was anything but. Severe geopolitical risk and severe inflation were the first quarter’s dominant investment headlines and through this chaotic period the Trust performed in line with expectations when evaluated in local currency terms. Currency headwinds were a slight challenge for the Trust as CAD/USD was stronger on a week-to-date, month-to-date and quarter-to-date basis, with one Canadian dollar costing approximately $0.80 US as the quarter closed.


First Quarter 2022 Highlights:

As previously mentioned, the first quarter of 2022 was defined by extreme geopolitical risk and extreme inflation. This had major implications for stocks, but the vulnerabilities of traditional fixed income holdings were comparatively more striking. The first quarter of 2022 was the worst quarterly return in the Canadian bond market in over 40 years. Details of the malaise are summarized in the table below. Please take a moment to allow the figures to sink in, noting that what you are looking at are the returns on bonds [not stocks].

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 Alternative Asset Trust Q1 2022 Commentary