The markets have been turbulent since the beginning of January. The Nasdaq, in fact, has dropped 12% in 2022, which puts it technically in a correction position. We have not been caught unaware or particularly surprised. We predicted a sell-off in the first quarter of 2022 because of the combined whammy of increased fed fund rates starting in mid-year and the effects of inflation. Fortis prepared for this by taking our equity exposure down to 38% in early January.
Our hedges are working. We predicted increased volatility for the first two quarters of 2022. We have capitalized on a rising VIX by taking positions that are non-correlated to the stock market. We cater to risk-averse investors and build portfolios that can withstand strong market movements. We wish our clients to remain confident, positive, and patient. These are market environments in which we do our best.
I shall provide an analysis of current volatility and our performance in the near future.
