With growing expectations that the US Federal Reserve will move to cut interest rates in the coming months, XIB Asset Management, a Canadian hedge fund that gained more than 200% in the first two years of the pandemic, is backing gold and uranium to outperform, according to a report by Bloomberg.
The report cites the firm’s Co-Founder Sean McNulty as saying in an emailed statement that: “Gold and other commodity-driven equities have traditionally performed well during the next stages of the credit cycle,” adding that there is also a looming supply shortfall in uranium, which is used to power nuclear reactors.
XIB, which was founded by McNulty and Peter Hatziioannou and pursues a flexible strategy that can include equity, debt and convertible securities alongside event-driven bets such as corporate reorganisations, posted a 0.8% loss in December, partly due to a reduced valuation in one of its private holdings but finished the year up 6.2%, having recovered from a 15% loss in 2022.
The XIB fund has returned about 227% since its inception in August 2019, with the vast majority of those returns coming during 2020 and 2021, according to the firm.
