C8 GBI December 2020 Monthly Report- Cirdan Capital
After a strong November, the Certificate gave back 1.2% in December to close 2020 with a 5.4% gain. It was certainly a challenging year to launch the Certificate, however it still made consistent gains through the year. Most impressive was the standout performance in the Q1 equity sell-off. Our back test shows that ‘well-governed’ stocks tend to outperform in equity sell-offs, as equity flows gravitate towards well-governed companies. This is a very positive characteristic of the Certificate, so good to see that confirmed in a live environment. In Q1, the low for the Certificate was a drop of 2½% compared to a drop of 17% in the HFRX Equity Hedge Fund index, and 26% in the S&P 500 index.
In terms of individual equities, the standout performers were all on the tech side in December, most notably NTAP, Apple and Cadence. However, this was more than offset by weakness in consumer stocks, such as Best Buy, Whirlpool, and Kimberly Clark, as the second wave of Covid-19 knocked US consumer sentiment.