Global Macro: Origins, History, Prospects

Andrew Rozanov

The purpose of this chapter is to set the stage and to provide an appropriate historical context for the rest of the book. All the other contributors were asked to focus on one particular aspect of global macro which they know well and which, when combined with the other insights, would offer a panoramic yet nuanced view of the current state of play in the global macro industry. This chapter, on the other hand, will look to the past, tracing the origins and history of global macro, but also look to the future, outlining three major developments that are likely to shape the industry going forward.

But, first, we must define our terms. While there is no universally accepted definition of “global macro,” typically most market practitioners will agree on the types of strategies covered by this term. As with most hedge funds, global macro managers strive to generate attractive risk-adjusted absolute returns in all market conditions, but they go about it in a very distinct and unique way. Specifically, all global macro funds usually share the following five characteristics:

  1. global scope (ie, risk taking across different geographies);
  2. multi-asset coverage (ie, risk taking across

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