MacNicol’s The Alternative Asset Trust Quarterly Commentary- January 2021

The MacNicol Alternative Asset Trust is a multi-strategy, alternative investment platform designed to generate returns that are positive and uncorrelated with public stock or bond markets. The Trust, through its underlying limited partnerships invests in real estate, private equity, and hedge funds. In total the Alternative Trust is invested in more than 150 separate real estate projects, private businesses, and hedge funds. The advantages of our approach to alternative assets include effective diversification, enhanced liquidity and a less volatile return profile compared to the individual asset classes themselves.

Alternative Asset Trust Update: The goals of the Alternative Asset Trust are to generate positive real returns each year and to help better diversify portfolios of conventional investment assets such stocks and bonds. The Trust was higher by 14.2% during 2021 and as always this is after all fees and expenses. During the fourth quarter, the Trust was higher by 3.6% with returns being driven primarily by real estate and private equity. Volatility was also generally low during the quarter and 2021, and notably lower than that observed in equity benchmarks such as the S&P500, the Dow Jones Industrial Average and the NASDAQ Composite over the same time frames. The Trust also outperformed both short-term and long-term Canadian bonds and felt equally at home as a safe haven or inflation fighter. To summarize, the Trust’s risk-adjusted performance in 2021 illustrated that alternative assets can be an effective tool at protecting investment capital from short-term risks, while growing investment capital over the long-term at rates that exceed inflation.

4th Quarter 2021 Highlights:

The 4th quarter of 2021 was defined by strong moves in developed markets, particularly in October. The perception that businesses and consumers were able to manage a world where COVID was a constant threat, accommodative monetary policy and (until then) undocumented problems with inflation made people feel good about investing in all kinds of stocks without considering what might happen should any one of those backdrops fall to the ground. Beginning in mid-November, investors began to observe significantly higher levels of inflation documented by official government agencies such as Statistics Canada and the Bureau of Labor Statistics.

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Alternative Asset Trust Q4 Commentary