| Asset | Q1 2024 | YTD | 2020 | 2021 | 2022 | 2023 |
| Jasper Capital | 82.31% | 82.31% | 104.42% | 130.48% | -17.49% | 106.58% |
| SPY | 10.05% | 10.05% | 16.26% | 26.89% | -19.44% | 24.23% |
| IWM | 4.78% | 4.78% | 18.36% | 13.69% | -21.56% | 15.09% |
| QQQ | 8.42% | 8.42% | 47.57% | 26.81% | -33.07% | 53.79% |
| VGLT | -3.72% | -3.72% | 15.12% | -6.72% | -31.09% | -0.13% |
| SPGSCI | 8.74% | 8.74% | -6.15% | 37.08% | 8.71% | -12.20% |
| Gold | 8.28% | 8.28% | 25.09% | -3.62% | -0.35% | 13.16% |
| Bitcoin | 68.69% | 68.69% | 304.57% | 59.40% | -64.23% | 155.68% |
Summary: The first quarter of 2024 was largely benign in terms of macroeconomic surprises. This helped lift risk assets above historical average and saw both treasury yields and the dollar index only slightly higher. The only “major” surprises on the data front came in the form of February and March CPI measures, with both months surprising to the upside. Short term selloffs were recouped rather quickly once investors realized the Fed was not going to immediately pivot back to a tightening cycle.
Performance: Reminiscent of last year’s Q1 performance, Q1 2024 was another strong opening quarter for Jasper Capital, with the portfolio achieving a net gain of 82.31%. Broad asset classes across the board returned positively except for long dated fixed income. Within the equity market, the SPY returned 10.05%, the IWM 4.78%, and the QQQ 8.42%. Broad commodities in the form of SPGSCI performed in line with Gold, returning 8.74% and 8.28%, respectively. The VGLT returned -3.72%. This quarter Jasper Capital was able to outperform all asset class including Bitcoin, which returned 68.69%. The portfolio underwent a major rebalancing through January and February and is now less concentrated in a small basket of financial assets, in turn hoping to gain exposure to broader sectors within the economy such as AI, cloud computing, and other growing software protocols.
Outlook: Jasper Capital is bullish going into Q2 2024. A few of the key questions top of mind last year are still relevant going into Q2. As a reminder, those questions were:
- Will we get the credit crisis that so many pundits expected in 2023?
- If a credit event does not occur, will the Fed still loosen conditions?
- If a credit event occurs, how will the Fed respond?
The absence of a credit event in Q1 combined with a Fed standing firm on three cuts led to a pricing out of rate cuts for 2024. Contrary to our expectation, the pricing out did not stifle gains in equity market, although we expect Q2 to be less favorable to a continuation of this environment. It is unlikely that either a return to immaculate disinflation or the reflation trade will lead to outsized gains in risk markets like they did in Q1. We maintain a bullish posture going into Q2 with caution warranted as we approach Q3, a period that will be defined by the geopolitical uncertainty in the US brought about by the 2024 general election.
