What’s Trending Now? by Stephen Scott\

Longboard Funds’ portfolio managers are long-term trend followers, so we make decisions solely based on a disciplined, rules-based process.

But we often get questions from you about how current events potentially relate to certain long-term trends.

Below is our team’s bi-weekly dive into the details.

Longboard Funds - What's Trending Now

down-arrowOil

  • Reserves increased by 1.1 million barrels due to U.S. production increase
  • Oversupply concerns due to resumption of output from fracking and oil sands
  • Demand forecast for 2016 down almost 1 million barrels

down-arrowJapanese Equities

  • Stronger demand for yen hurting equities
  • Markets pricing in 10 trllion yen stimulus package since Abe re-election
  • Bank of Japan confirmed no intention to implement helicopter money

down-arrowEuropean Equities

  • Growth concerns due to Brexit and high debt levels of PIIGS
  • Banks under continued pressure from low interest rates
  • Italian banks dragging markets lower

up-arrowCotton

  • USDA reporting production cuts for 2016 and 2017
  • Tight supply globally, especially China and India
  • Global trade forecast for 2016-2017 raised by 1 million bales

up-arrowREITs

  • Low interest rates forcing investors to seek alternative sources of yield
  • REITs have considerably less leverage than pre-crisis levels
  • U.S. Fed less likely to raise rates this year

up-arrowUtilities

  • Low interest rates forcing investors to seek alternative sources of yield
  • Low volatility attractive in uncertain economic environment
  • Sector has stable revenue streams, is highly regulated