Brevan Howard’s fund feeder BH Global Limited (LON:BHGG) was up 0.33 percent in March and has returned +2.16 percent for Q1. Brevan Howard’s largest allocation BH Master Fund was up 0.23 percent in March, which brings the fund’s YTD returns to +3.36 percent.

Brevan howard
Geraldine Sundstrom, Portfolio Manager at Brevan Howard

The highest gain among Brevan Howard’s funds was posted by Brevan Howard Credit Value Master Fund Limited, the strategy was up 2.36 percent in March. The largest detraction was seen in Brevan Howard Emerging Markets Strategies Master Fund Limited which was down 3.02 percent in the same period. The macro focused Brevan Howard Master Fund lost in European rates and interest rate volatility trading. The Master fund gained in macro equity trades in March.

Being a global macro fund, Brevan Howard’s performance has been not as great as other large macro funds. Discovery Capital’s Global Opportunity Fund has returned 15 percent in Q1, Fortress Macro was up 7 percent whereas Tudor B.V.I Global gained almost 8 percent in the same period.

Brevan Howard On Japan

In terms of Japan focused investments, the Brevan Howard Asia Fund was up in its JPY interest rate trades, the Asia Fund was up 0.28 percent overall in March.  The hedge fund’s monthly commentary says that Japan’s economy is showing signs of recovery, the manufacturing PMI gained 2 points and is up to 50.4 in March, according to data from Markit. Japan’s trade deficit also slashed down to 677 billion yen from 1480 billion yen in February.

The recovery and signs of economic well being are expected to strengthen in Japan as Shinzo Abe aims to win the upper house election in July. Brevan Howard notes Japan’s joining of Trans-Pacific Partnership negotiations as a sign of seriousness towards building industrial stability and pursuing structural reforms.

US and Budget Cuts

In US, Brevan Howard expects that the fiscal drag from budget sequester and tax hikes will phase out by 2014. The fund expects the growth in the private sector to bring overall improvement to the US economy. The fund’s commentary adds that for the US economy to grow steadily, the unemployment numbers have to keep improving. On Fed’s plans of monetary easing, the firm expects it to continue through this year with more asset purchases.

In UK, Brevan Howard saw growth in Q1 stalled by slowdown in industrial production and construction. BH Global Limited (LON:BHGG) expects UK to achieve growth in between of US and eurozone. UK economy gets backstopped over and over again, the budget defecit keeps increasing and the government is revising up its estimates after every quarter.