Discretionary Trading Q3 2021 commentary

SaxoSelect Commentaries
Saxo Bank

Instruments tradedFX spot and CFDs
Asset classesFX, equity indices, commodities, government bonds
Investment styleDiscretionary (non-systematic), volatility, opportunistic 
Quarterly return-7.86% (net of all fees)
Annualised return volatility (since Sept 2015)34.2%
Average trades per week (since start of strategy)

Market overview

Equities continued on a strong rally until US Labor Day weekend in September, when they peaked at 20% YTD performance for S&P500 and in a similar fashion for other major indices. The rally continued despite considerable challenges in the form of rising inflation around the globe, but especially in the USA, that puts into question the current extraordinary accommodative monetary policy. 

The  Chinese economy and financial system showed signs of weakness, especially withinthe  property market and the potential default of the real-estate developer Evergrande. Despite this and ongoing regulatory crackdown, market remained resilient, and only had 3,7% and 2,5 % corrections in July and August measured by S&P500. These pressures, coupled with energy crunch and global supply chain issues, finally managed to break the strong equity rally and the market entered into correction in September that so far shaved 6% of value for S&P 500.

Despite rising inflation, bond yields fell in July-August helped by surprising  stance from the Fed that dismissed inflation as transitory and postponed tapering of its assets purchases. Only after the September US Federal Open Market Committee (FOMC) meeting, they changed course and pre-announced assets buying tapering, then yields began to rise again.

Commodities were in correction mode from May for metals and July for oil until second half of August when prices for natural gas and coal exploded (especially in Europe and China). This market development together with the looming energy crunch changed the landscape completely. The correction was due to Chinese management of the markets by releasing strategic reserves. China even started releasing strategic reserves of oil at the beginning of September, only to change the course shortly after and begin buying when energy crisis began and commodities started its rise at an all-time or multi-year highs. Despite great monetary conditions to rise, precious metals remain structurally hindered by cryptocurrencies competition that are being bought for the same reasons that traditionally sustained precious metals demand.

Currencies remain relatively muted, although there was notable USD strength due to growth and since September FOMC meeting, a notable Yen weakness was observed to all crosses.

Strategy performance (net of all fees)

Since launch of partnership with Saxo Bank (September 2015)220.74%

Notable trades 

NAS100 Contributed -4.2% to the strategy’s performance.
Contributed -2% to the strategy’s performance. 
30y UST
 Contributed  1.7% to the strategy’s performance.
 1.4% to the strategy’s performance.


The biggest question is about inflation and whether it is transitory or persistent. If persistent, then Fed has committed a policy mistake and it needs to rapidly change course with big  implications for financial markets. Equity markets can benefit from inflationary environment until it brings a policy response or until rates rise and supply-side problems don't affect revenues and profit margins.

Different reactions from central banks to the inflation theme can bring volatility to currencies and bonds. Commodities are in a bull market with supply under-investment and green energy transformation that will bring plenty of opportunity to trade. With the above stories to play out over upcoming months, the strategy remains well poised to capture trade opportunities.


Any information found in this document, including performance information and statistics are subject to change. You can find the latest updated pricing information on the description page for each available portfolio. In providing this material Saxo Bank has not taken into account any particular recipient’s investment objectives, special investment goals, financial situation, and specific needs and demands and nothing herein is intended as a recommendation for any recipient to invest or divest in a particular manner and Saxo Bank assumes no liability for any recipient sustaining a loss from trading in accordance with a perceived recommendation. All investments entail a risk and may result in both profits and losses, and all capital is at risk. In particular investments in leveraged products, such as but not limited to foreign exchange, derivatives and commodities can be very speculative and profits and losses may fluctuate both violently and rapidly. Speculative trading is not suitable for all investors and all recipients should carefully consider their financial situation and consult financial advisors in order to understand the risks involved and ensure the suitability of their situation prior to making any investment, divestment or entering into any transaction. Any mentioning herein, if any, of any risk may not be, and should not be considered to be, neither a comprehensive disclosure of risks nor a comprehensive description of such risks. Any expression of opinion may not reflect the opinion of Saxo Bank and all expressions of opinion are subject to change without notice (neither prior nor subsequent).

Saxo Bank A/S (Headquarters)
Philip Heymans Alle 15

Contact Saxo

Select region


Trade responsibly
All trading carries risk. Read more. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more

This website can be accessed worldwide however the information on the website is related to Saxo Bank A/S and is not specific to any entity of Saxo Bank Group. All clients will directly engage with Saxo Bank A/S and all client agreements will be entered into with Saxo Bank A/S and thus governed by Danish Law.

Apple and the Apple logo are trademarks of Apple Inc, registered in the US and other countries and regions. App Store is a service mark of Apple Inc. Google Play and the Google Play logo are trademarks of Google LLC.