Issuer: ELEMENT ONE LTD
ISIN Number: VGG299771086
Issue Description: USD CL B SHS
ISO CFI: CICXXX
In early July, the U.S. Department of Labor published a strong labor market report for June 2019. Non-farm sector employment grew by 224,000 over the month, hourly average wages rose by 3.1% in annual terms.
On July 10, the SPX index for the first time in history exceeded the mark of 3,000 points in anticipation of a rate reduction.
On July 19, gold futures began to consolidate above the $1,450 per ounce, returning to May 2013 values. The tension of the trade conflict is forcing investors to shift into defensive assets.
On July 31, the Federal Reserve System lowered the rate by 0.25% for the first time since 2008, but Fed Chairman Powell emphasized in his statement that this rate reduction is not the beginning of a new cycle of reduction the cost of borrowed capital.
The Element ONE fund in July showed a negative result - the share price fell 3.07% to $1,496.5. In the middle of the month, we opened a short position on Interactive Brokers (IEX:IBKR) for hedging longs. On July 19, we added a long VMware stock position (NYSE:VMW) to the portfolio, breaking through the moving average (50), which, in our opinion, has every chance to end the year with a result above $195 per share. Unfortunately, half of the securities had to be closed with a stop-loss at a price of $165 per share. However, we are looking at the company's unique decisions with positive eyes and plan to average the position in September.
Issuer: RAM Data Technologies INVT LTD
CUSIP Number: G7369L 106
ISIN Number: VGG7369L1067
Issue Description: EUR CL C SHS
ISO CFI: CICJMS
In July 2019, bitcoin was not so volatile compared to previous periods - its price ranged from $9,000 to $13,000, only once breaking the upper limit of the specified price range. By the end of the month, BTC fell in price by just over 6% of the month’s opening, ending the month in the region of 10,000 US dollars.
The month turned out to be not the richest in bright events - the regulators' claims to Facebook were mainly discussed regarding their crypto project Libra. A number of local and international companies informed about the start of using BTC to accept payment for services and products, as well as their participation in the creation of exchanges, wallets or cryprtocurrencies. For example, Norwegian Air will sell tickets for bitcoin, Daimler AG (which includes the Mercedes-Benz concern) is developing a cryptocurrency wallet for cars, and Roma, Juventus, PSG football clubs plan to launch their own cryptocurrencies.
In July 2019, Mining.VG, like the cryptocurrency market, showed a negative trend compared to June 2019 - minus 1.53%, taking into account accumulated and paid coupons. In July 2019, the mining fund added the Cuckatoo31 algorithm for 1080ti video cards, which allowed to increase revenue for this type of cards by 10-15% relative to bitcoin. However, the negative trend of the ETHBTC pair did not allow to derive the proper benefit from a partial transition to the specified algorithm. The fact is that a large amount of equipment runs on the ethash algorithm and sells this power for Ethereum mining, getting Bitcoin for it. Thus, with a drop in the cost of Ethereum relative to Bitcoin, the profitability of video cards decreases, in July the decrease in the ETHBTC pair amounted to more than 30%. In addition, in July, the Ethereum mining difficulty increased by 5% from 2.1P to 2.2P, which at constant power yielded a reduction in remuneration. All this was reflected in a decrease in mining remuneration in euro equivalent from 12.8 thousand euros in June to 9.7 thousand euros in July 2019.
At the same time, we see the completion of the corrective movement of cryptocurrencies, which began at the end of June. The fund continues to store major reserves in BTC, which is a stabilizing factor in the medium term.
We also made minor technical improvements on the website and now we display the fund’s yield chart taking into account the accumulated and paid coupons for the convenience of fund’s investors.