Stockholm (HedgeNordic) – February was a mixed month for stocks across the world, with US stock market indices finnishing the month in the red after rallying in January. In contrast, the shipping corner of equity markets enjoyed a very strong February, with shipping-only hedge fund Cleaves Shipping Fund out of Norway booking a monthly advance of 13.8 percent.
“February was mixed for the stock market in general, as signs on easing inflation have been challenged by strong retail sale and job reports,” says Carl Synvis, Head of Fund Management and Portfolio Manager at Cleaves. “In the shipping space, we have seen a different picture than the rest of the market,” he emphasizes. “Shipping equities have outperformed all major markets, especially the S&P 500, which was down almost four percent.”
“In the shipping space, we have seen a different picture than the rest of the market. Shipping equities have outperformed all major markets…”
Cleaves Shipping Fund, a shipping-only long/short equity-focused hedge fund under the umbrella of Oslo-based Cleaves Securities, was launched within a Norwegian alternative investment fund structure in October 2021 before launching in an Irish structure in the summer of 2022. The fund overseen by Carl Synvis from October of last year has returned 40.6 percent since its launch in a new Irish ICAV structure in July 2022. Last month’s advance of 13.8 percent was one of the fund’s best months.
“Investors are still focusing on China and its recovery, with positive news during the month,” explains Synvis. “The main contributor to the fund’s performance last month came from strong fourth-quarter reporting from tanker companies such as Teekay Tankers,” he elaborates. “Dry bulk equities also had an impressive performance during the month and freight rates have really starting to improve.” The capesize shipping market, which is a key barometer of commodities international trade, saw capesize freight rates increase by more than 100 percent in the second half of February, according to Synvis.
“The main contributor to the fund’s performance last month came from strong fourth-quarter reporting from tanker companies such as Teekay Tankers.”
Cleaves Shipping Fund mantains exposure to different shipping segments – such as containers, tankers, dry bulk or gas carriers – using equity securities, and can invest in derivatives, forward freight agreements, among others. The fund currently maintains its largest exposure to the tanker and dry bulk sector, but also holds equities in other sectors such as the LNG sector, according to Synvis. “The LNG sector also has performed well during the month of February.”