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In May, most asset classes rebounded after April’s decline:
US stocks led the way, with the S&P 500 rising +5.06% as corporate earnings showed resilience. Real estate also rebounded, with the YOY index rising +4.93% as lower mortgage interest rates sparked renewed demand. International stocks participated The rally rose +3.95%.
Bonds stabilized, with the Barclays Overall Index rising 1.68% as yields retreated from their recent highs. Hedge funds captured the upside with further trend setting as the QAI advanced +1.35%.
On the other hand, commodities suffered from weak manufacturing data, with the GSG index falling -1.44%. Managed futures strategies gave back some gains, with the index down -1.99% as a trend reversal in interest rates and commodities created headwinds.
Year to date, most asset classes are in positive territory, with US stocks leading the way at +11.30%. Commodities also posted significant gains of +9.42% Overall, while global stocks rose by +6.10%.
Real estate and bonds remain in negative territory for the year, at -4.83% and -1.45% respectively, as rising interest rates pressure valuations. Managed futures weathered volatility well, rising +5.33% by tactically shifting between long and short exposure.
As we head into June, it’s important to be aware of the mixed backdrop. On the one hand, the strong rebound in stocks and real estate in May may indicate that the worst of the interest rate adjustment is behind us. However, uncertainty remains high, with bond markets anticipating further rate hikes in the coming months. This could put pressure on valuations of interest rate-sensitive assets, and hedge funds may shift to more defensive positions after a strong month.
Past performance is not indicative of future results.
Past performance is not indicative of future results.
Sources: Managed Futures = SocGen CTA Index,
Cash = US Treasury coupon equivalent to a 13-week coupon at an annual rate/12, with the sum of each month’s value since the beginning of the year,
Bonds = Vanguard Total Bond Market ETF (BND),
Hedge Funds = IQ Hedge Multi-Strategy Tracker ETF (QAI),
Commodities = iShares S&P GSCI Commodity ETF (GSG),
Real Estate = iShares US Real Estate ETF (IYR),
Global stocks = iShares MSCI ACWI ex US ETF (ACWX),
US stocks = SPDR S&P 500 ETF (SPY).
All ETF performance data from YCharts
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Editor’s note: The summary points for this article were selected by Seeking Alpha editors.
