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Catalyst Macro Strategy Fund MCXAX

Normally I wouldn't touch any investment I didn't understand but I am intrigued by the results MCXAX is achieving year to date. Anybody have any idea what they are doing?


  • @Joe I have a small position in this fund. It is a roller coaster ride...not for the faint of heart. I think the results are driven primarily by definitely doesn't move in lockstep with the market.
  • They describe their strategy somewhat in this presentation:

    I put some money into it recently. I view it in the same category as other go-anywhere, tactical allocation funds like Pimco All Asset Authority (PAUIX) or Whitebox Tactical (WBMIX) -- the manager makes big bets on where they think the market is going, and the fund goes up when they're right, and goes down when they're wrong. Just like PAUIX and WBMIX, I fully expect MCXAX's strategy will work until it doesn't.

    FYI, the institutional class of the fund (MCXIX) is available at Vanguard and TD Ameritrade for the same minimum initial purchase as the A shares. Lower expense ratio, but generally costs a transaction fee.
  • I'm in this fund and it is definitely not like PAUIX. MCXIX can move 8% in one day. So far a good but incredibly choppy ride.
  • edited November 2015
    I have owned it for around a half year, and I agree with little5bee as far as it being a roller coaster ride. It will will make you very happy when you least expect it (when the market went way down a few months ago, that one day MCXIX went up 9%, pretty much unheard of for a mutual fund, particularly with the market way down), It can also be frustrating when you least expect it (it has gone down during good market days). It has moved more in a similar direction as the market over the last month or so. Follow claimul's link to get an idea of the strategies the managers use. You just have to let the managers do their thing, and ignore it if the performance goes amiss in the short term. I have hung with it, and it seems to be paying off.
  • edited November 2015
    Chinfist said:

    when the market went way down a few months ago, that one day MCXIX went up 9%

    Yes...and that day was followed by a precipitous drop:( I find it very difficult to determine when to add to my position. I was going to add after the aforementioned drop, but I was too chicken. It's been pretty much straight up since then.

  • edited November 2015
    Top 5 positions:

    VelocityShares Daily 2x VIX ST ETN 11.72 325,000 325,000 — — — — United States

    VelocityShares 3x Long Crude Oil ETN -9.65 788,000 788,000 — — — — United States

    VelocityShares 3x Long Natural Gas ETN -4.76 595,000 595,000 — — — — United States

    VelocityShares 3x Inv Natural Gas ETN -4.51 210,500 210,500 — — — — United States

    iPath® S&P 500 VIX ST Futures™ ETN 3.77 50,000 50,000 — — — — United States


    Good luck to those in it.
  • scott said:

    Good luck to those in it.

    LOL, I cracked up seeing the Seinfeld as it relates to this fund. Fully appropriate. It is up nearly 50% YTD though so they are doing something right. I'm sticking with it.
  • edited November 2015
    Chinfist said:

    scott said:

    Good luck to those in it.

    LOL, I cracked up seeing the Seinfeld as it relates to this fund. Fully appropriate. It is up nearly 50% YTD though so they are doing something right. I'm sticking with it.
    The fear that I have - and it may be completely wrong - is that this is the kind of thing that does unbelievably freaking well and just continues to hit home runs and everyone buys it and everyone loves it. Then with a strategy like this, one wrong thing happens (and when you're dealing with a bunch of 3x funds long or short, that's a bit of a possibility), it quickly gets obliterated (even if for 6-12 mo) and the fund that everyone loved is suddenly hated and people sell first and ask questions later.

    To me this is a supporting player, you don't have a ton of your portfolio in it and it will probably be significantly uncorrelated in terms of returns vs the broader market for (much) better or (much) worse.

    I gotta say I'm really interested in this fund in terms of what makes it tick and I'm going to explore it more closely, but the initial reaction with using a bunch of 3x ETNs is no. We'll see, but if I buy it I'd keep it to a minimum at most.
  • I think they should just call it Vegas Strategy Fund.
  • Thanks to Scott for pointing out the top 5 holdings - while old it is most likely still useful in seeing the usage of 3X levered funds. I bought a small stake on its dip two months ago and am not likely to buy any more unless I sell a small piece first. Yes, it's been successful so far but could easily blow up over a few days and not recover for awhile. I guess what I like is over the past 2 months its had no or negative correlation with SPY when it's gone down a bunch.
    FWIW, looked at a bunch of Catalyst Funds, and also took a position in HFXIX. A negative for me is it looks like a whole slew of funds were thrown out there with the hope of that there'd be one or two winners in the bunch. Also, looked at TVTIX and its strategy - something that should make money most of the time but be vulnerable to quick volatile downward moves in SPY - probably not what you'd want in an alternative fund. Danger sign - lost 15% at the end of August which was to be expected as SPY dropped 10%. But, with SPY making everything back +1%, TVTIX has made nothing back! To me, it means we need to keep a close eye on MCXIX, and understand that anything can happen. The fund may just be riding a hot streak, and can cool off and not necessarily get hot again.
  • @walt It seems like you have excellent timing! Could you please let me know when MCXIX is at a top? ;)
  • 5bee - timing was pure luck. No clue on top or bottom, but I plan to sell some if it continues to go up. I did notice that most of the other Catalyst funds run by the same manager have gotten off to a poor start.
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