Chris Rokos scooped a profit in 2023 as his all-directional macro hedge fund, Rokos Capital Management RCM, returned 8.8% in a turbulent nose-bleeding year, particularly for bond investors.
Chris Rokos RCM oversees about $16 billion in assets. The minted trader’s net worth is estimated at 1.54 billion USD, as of January 2024.
Recovering from early first-quarter losses in the year, Chris Rokos scooped a profit in 2023
For those unaware of the market conditions, in 2023, the first quarter was extremely challenging for investors. Socks and bonds shed value in Q1 of 2023 against a backdrop of an escalating war in Europe and hawkish Fed rate tightening to dampen the inflation fire.
“Chris Rokos RCM oversees about $16 billion in assets. The minted trader’s net worth is estimated at 1.54 billion USD, as of January 2024”
WEALTH TRAINING COMPANY
The magnitude of rate tightening in 2023 was unprecedented, with a 24-fold increase in interest rates from O.25 to 5% in a little more than a year.
Moreover, the fallout from Fed chair Powell’s radical tightening to smother the inflation fire was the 2023 burst of the bond bubble, slashing trillions of dollars off the book value of bonds. As the yields on treasury Bills rose in tandem with Fed interest rate hikes, rational savers yanked their cash deposits at the banks and invested in short-term maturity treasury bills paying above 5%. The worst banking crisis liquidity squeeze unfolded, probably worse than the 2008 financial crisis, as five banks collapsed in 2023. The Fed’s Discount Window Borrowing, an emergency funding facility for banks, prevented a bond market collapse.
If the banks had no alternative other than to sell their depressed bond asset portfolio in a depressed market at a loss to raise liquidity, the bond crash (already the worst in the history of treasury bonds) would have triggered financial contagion and global banking collapse.
“The magnitude of rate tightening in 2023 was unprecedented, with a 24-fold increase in interest rates from O.25 to 5% in a little more than a year”
WEALTH TRAINING COMPANY
What prevented a 20s Great Depression run on banks?
Mainstream media kept silent about the worst bond crash in history, so reality, the severity of the situation, did not reach critical mass. The Fed also responded timely with emergency bank funding facilities. But those who believe that inflation is far from over would argue that we are not out of the woods.
Central bankers now probably fear inflation more than WW3.
“The middle class must accept they can’t afford Range Rovers – they’re only for rich people” – The Telegraph
Chris Rokos scooped a profit in 2023 as the Fed’s great pivot came into Vista in Q4
A highly leveraged system and a hawkish Fed advocating rate hikes is like a high octane environment looking for a match.
A highly indebted system cannot shoulder higher interest rates, irrespective of inflation rates, since it risks imploding the multi-trillion dollar treasury market, destroying the collateral base of the Western banking system, bankrupting the governments and ending it in a Mad Max.
So the solution is more of the same, fire up the printing press and hyperinflate the debt away.
They will tell us inflation is under control while they make living in a pod and eating bugs sexy, or maybe they will make being cannon fodder, dying in some hellhole of war, patriotic and sexy again.
The programming is already starting. “The middle class must accept they can’t afford Range Rovers – they’re only for rich people,”
Seven decades ago, a working-class man maintaining a wife and a family on his wages could afford to drive a Leyland or a Rover and have a motorbike in the garage.
“I see the gentle march of millions into poverty,”written a decade ago.
The wealth divide will accelerate with every central bank pivot because the wealthier you are, the more assets you own, and the banks are likely to lend to people with collateral.
“Chris Rokos scooped a profit of 8.8% in 2023 based on his long bond and stocks positions” – Wealth Training Company
Chris Rokos scooped a profit in 2023 with most of it being made in the final quarter of the year
Investors were positioning themselves early for the anticipated Fed pivot based on the pretence that inflation is under control. So bonds and stocks rallied into late 2023.
Chris Rokos scooped a profit of 8.8% in 2023 based on his long bond and stocks positions
In July, Chris Rokos’s fund returned just 2.7% for the year through July, according to people familiar with the matter.
Macro hedge fund peers tracked by Bloomberg have returned 0.8% on average in July 2023.
Rokos counts among macro traders who have seen their fortunes undergo a wild swing this year because of volatility in the interest rate markets. His hedge fund was down more than 15% at one point in March after bets on short-term interest rates failed to pay off amid the collapse of Silicon Valley Bank. The losses, which followed a 51% surge in 2022, prompted him to de-risk the fund.
Chris Roko’s top Tory donor’s hedge fund was hit by bond market turmoil.
Wiith the Fed’s great pivot in sight, Chris Rokos scooped a profit in 2023 and is now in talks to raise $2 Billion for the Macro Hedge Fund
The bull market could be gearing for a new easing cycle, and nothing else matters.
Our top trend in 2024 was BTFD, and it could turn out to be a good play, because let’s face it, what else can central banks do?
So we are not surprised that the likes of Chris Rokos are on the raising money trail.
The alternative to not investing is a guaranteed loss of purchasing power to inflation. Invest it, spend it, or lose it.
At this rate people will be taking out loans to buy bicycles.
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