Fulcrum Asset Management, a global macro hedge fund, is navigating the complexities of modern markets by blending quantitative systems with human discretion. According to Chief Investment Officer Suhail Shaikh, the firm has adapted to the volatility created by events such as the Trump presidency, which he says has been beneficial for macro trading opportunities. Fulcrum Asset Management aims to translate detailed research into actionable trades, boasting a 54 per cent hit rate. The $12 billion fund focuses on getting more smaller trades right rather than making large, risky bets.
After struggling in a low-volatility environment driven by central bank interventions post-2008, Fulcrum has shifted its strategy to amplify bets through leverage, increasing potential payoffs. The firm also concentrates on identifying trades with asymmetric payoffs, aiming to profit regardless of market direction. This approach helped the fund achieve a 7.7 per cent return in January, its best on record, and an 18 per cent one-year return. Fulcrum utilises artificial intelligence to analyse events, such as Kevin Warsh’s potential influence on the Federal Reserve, to inform its trading strategies.
To remain competitive against the rise of multi-strategy funds, Fulcrum has given its 12 portfolio managers a stake in the business. This strategy helps incentivise talent to work for the business in the long term. Additionally, Fidante, the investment management arm of Challenger, acquired a 22 per cent stake in Fulcrum in October, aiming to enhance distribution in Australia and New Zealand, where the firm manages $1.2 billion in assets for institutions and advised clients. Suhail Shaikh says Fidante’s long-term investment approach and distribution capabilities were key factors in the decision to partner with them.
Looking ahead, Fulcrum is focused on understanding how AI will reshape the global economy, but Shaikh remains uncertain about the specific direction of its impact. Fulcrum Asset Management combines detailed research into actionable trades and its 54 per cent hit rate proves they have “a true edge”. The firm seeks to adapt and survive the volatility drought by considering the “behavioral psychology of the client”.
