What are the two types of global macro strategies?

The distinction between systematic and discretionary strategies is pivotal in global macro investing. Systematic strategies rely heavily on quantitative models and algorithms to make investment decisions, emphasizing data analysis and statistical techniques. These models may assess macroeconomic indicators, market trends, or various financial signals to guide trading strategies without human intervention.

On the other hand, discretionary strategies depend on the insights, judgement, and experience of portfolio managers or traders. These professionals analyze macroeconomic conditions and geopolitical developments, making decisions based on qualitative assessments and their understanding of market dynamics. This approach allows for flexibility and the incorporation of unique insights that may not be captured by models.

The combination of these two methodologies illustrates the diverse approaches within the global macro strategy framework, allowing fund managers to adapt to different market environments and respond to economic shifts effectively. By understanding both types, investors can appreciate how different global macro strategies can be employed to capitalize on various market conditions.