Understanding Global Macro Strategy

Explain : Global Macro Strategy

A global macro strategy is a hedge fund or mutual fund strategy that bases its holdings primarily on the overall economic and political views of various countries or their macroeconomic principles. Holdings may include long and short positions in various equity, fixed income, currency, commodities, and futures markets.

For example, if a manager believes the United States is headed into a recession, he may short sell stocks and futures contracts on major U.S. indices or the U.S. dollar. He may also see a big opportunity for growth in Singapore, taking long positions in that country's assets.