There is a good piece in the Financial Times on global macro by Laurence Fletcher and Robin Wigglesworth. (FT, 20 August 2020: Macro hedge funds enjoy unlikely renaissance). Of all investment strategies, this was the great disappointment post 2008.
Having been one of the few strategies to outperform in 2008, the hedge fund industry and investors had high hopes for macro in 2009 and beyond. Yet global macro strategies flatlined for many years and ultimately meant the end of many big-name managers.
The factor that few managers had failed to take into consideration was the Fed. The old maxim to not fight the Fed was ignored – if macro managers had understood this in 2009, then it would have been one of the great macro trades.
From this harsh lesson, today’s macro managers are better prepared. Yet with significant dislocations, in equities, bonds and commodities, across global economies and politics, there are real questions about whether central bank action is enough.
This time round, managers will not ignore the Fed. But their investment approach is less binary, with a more expansive toolkit. These are markets that could well see the 'renaissance' of the macro manager.