Habitus Capital

Habitus Capital is a private hedge fund fusing human potential with technological intelligence.

[Habitus Capital @HabitusCapital]

Investors' Letter 01.01.2021 - 'Walk the Talk'

[Habitus Capital @HabitusCapital]

pair particularly with supply issues likely to impact round two of the UK #pfizer rollout and the ongoing export bans Europe is attempting to impose. #trading #investingstrategy

[Habitus Capital @HabitusCapital]

The #covid19vaccination programme in the UK that began on 8th Dec 20' with #pfizervaccine has created a very strong correlation in the #eurgbp #fxmarket . A strong programme in theory means the UK will be open for business ahead of Europe. The result since December is a widening

[Habitus Capital @HabitusCapital]

10yr yield spread between UK and Germany from 81bp to 114bp in just 3months. This significant move implies market expectations are for a growth/reflation spurt to occur in UK well ahead of Europe. The result is a 7% move in the #eurgbp #forexmarket . Keep a close eye on this

[Habitus Capital @HabitusCapital]

to be intervening in the current move in longer-dated yields and the promise to keep rates low until actual inflation arises. #trading #investing #strategy

Daily charts include US10yr and Silver futures

[Habitus Capital @HabitusCapital]

The #FOMC #FED #powell was explicit last week. We will keep rates pegged at the zero-bound unless we see ACTUAL AVERAGE inflation above 2% for a sustained, non-transitory period. US10yr yields have tested 1.75% this past week. The price trend for US10yr has seen 8 weeks

[Habitus Capital @HabitusCapital]

The price action is clearly pointing toward significant buying in both silver and gold. This will become evident and obvious once US10yr yields stabilize and stage a short term bounce. We believe #gold and #silver are great longer terms buy and hold positions with the #FED likely

[Habitus Capital @HabitusCapital]

given the risk of a Fed pushing back but more importantly, 10year yields are currently fair value.
#trading #investing #strategy #Macroeconomics

[Habitus Capital @HabitusCapital]

The #inflation narrative continues to dominate heading into the #fed #fomc meeting this week. That said its important to find perspective with regards to the current move in 10-year bond yields. Whilst the speculative market is heavily short longer-dated bonds yields , further

[Habitus Capital @HabitusCapital]

#covid19pandemic avg US inflation was around 2.3%, with 10yr yields at 1.80%. Given US inflation is currently averaging around 1.4% , the current 1.62% 10 year yield is representing fair value. Until further notice, playing for higher yields seems counterproductive,

[Habitus Capital @HabitusCapital]

the trend remains firmly intact until we see another hiking cycle ending . According to the latest #powell statement, this is not likely to begin until 2023. #investing #macroeconomics #strategy

[Habitus Capital @HabitusCapital]

Its important to have a road-map as an investor. Whilst our core strategies are on a short-term timeframe, we are always acutely aware of the key underlying market drivers. The narrative has recently shifted to higher yields and their impact on equity valuations.

[Habitus Capital @HabitusCapital]

occur when 2yr rates peak, not when they trough. This is key takeaway from this chart. Whilst there is currently increased volatility due to rising longer-dated bond yields, 2yr has not moved, hence #FED is not overly concerned. Pullbacks for equities are healthy but objectively

[Habitus Capital @HabitusCapital]

on this yield spread and likely put a cap on the advance in the #GBPUSD rate. We expect 1.42/1.44 resistance to hold and this is our base case until this rate spread turns negative. #trading #investing #macroeconomics

[Habitus Capital @HabitusCapital]

It is a big week for the UK as the Chancellor #Sunak outlines the fiscal budget. The reality is the economy is smaller, the debt pile larger and the scarring evident. What interest us from this release will be the impact on UK 2 year yields.

[Habitus Capital @HabitusCapital]

in 2021. This is on account of the recent further tightening in the spread from 20bp to 3bp. Should the spread turn negative, 1.44 on spot will likely be tested. However we believe this budget on Wednesday as well as #BOE intervening to talk down rates will likely put a floor