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$ off its pea, 'Black Swan' fund is up 4,144% this year, warns we are 'trapped in the mother of all global financial bubbles'

https://finance.yahoo.com/news/universa-investments-march-performance-164113528.html

$ slides first along with the market; then shoots up as market slides because of confidence in $ around the world; now is reversing its trend





The hedge fund founded by Mark Spitznagel specializes in convex tail hedging and investing. Universa’s specific brand of tail-risk hedging limits losses from an outsized market event. When markets go down, this tail hedge acts like insurance for a portfolio. And since its inception, investors have seen a +239% net return on capital, according to the report.

In the letter, Spitznagel described markets as “very much trapped in the mother of all global financial bubbles,” pointing to high valuations and the Federal Reserve’s emergency moves to blunt the worst effects of the coronavirus crisis.

Universa’s returns are even more impressive given the unprecedented volatility seen last month, as the COVID-19 pandemic roiled markets.In March, the S&P 500 (^GSPC) plummeted 26.2% at its lowest point, but recouped some of those losses to end the month off by 12.35%.

“Markets were priced for ‘perfection,’ and now, following even more of the greatest monetary stimulus in human history (much of it in the span of just the last few weeks), they’re still priced for ‘really good’—still very expensive,” the investor told clients.

“So this is far from over; the current pandemic is merely threatening to pop the bubble,” Spitznagel wrote, warning that officials may be “running out of ways to keep the bubble inflated.”

He added: “Make no mistake, it’s the systemic vulnerabilities created by this unprecedented central-bank-fueled bubble, and the crazy, naïve risk-taking and leverage that accompanies it, that makes this pandemic so potentially destructive to the financial markets and the economy.”