From a small northwestern observatory…

Sorry we’re running late this month — Labor Day travels and such really got us behind the curve.

One challenge of running a “hedged fund” is that when the market is going straight up, the hedges tend to work against you. August was a case in point. This was one of the very few months when the S&P real estate index beat ACCRE, and of course the S&P 500 was on a huge bull run this month, earning nearly 3%. I would note that so-far in September, ACCRE is doing much better, but we’ll get back to you on that in a couple of weeks.

Our Sharpe Ratio statistics also tell an important story. We continue to be uncorrelated with the broader market, but the S&P’s average daily excess return is has been nothing short of amazing of late. Naturally, we hope this bull run continues, and we’ll continue to monitor our hedge positions going forward.

We hope everyone had a great Labor Day holiday! As usual, if we can answer any questions on these or other real estate topics, please don’t hesitate to reach out.

John A. Kilpatrick, Ph.D., MAI — john@greenfieldadvisors.com