Invesco DB US Dollar Index Bearish Fund Quarterly Report for the Period Ended March 31, 2024
Invesco DB US Dollar Index Bearish Fund Quarterly Report for the Period Ended March 31, 2024
In the first quarter of 2024, Invesco DB US Dollar Index Bearish Fund reported a net asset value of $34.50 per share, a decrease of 0.4% from the previous quarter. The fund experienced a decrease in total net assets, which was primarily due to a decline in the value of the underlying assets. The fund’s net expense ratio for the quarter was 0.85%, down from 0.86% in the previous quarter. The fund’s average daily volume was 10,000 shares, and the weighted average market price of the underlying assets was $100. The fund’s management discussed the market conditions and the fund’s performance in their discussion and analysis of financial condition and results of operations.
Company Overview
The Invesco DB US Dollar Index Bearish Fund is an exchange-traded fund that aims to track the Deutsche Bank Short USD Currency Portfolio Index. The Fund takes short positions in currency futures contracts linked to the US dollar in order to profit from a decline in the dollar’s value relative to other major currencies.
Fund Performance Overview
In the first quarter of 2024, the Fund’s share price fell 2.39% on a market value basis. This reflected a positive performance for the US dollar, which led to losses for the Fund.
In the first quarter of 2023, the Fund’s share price rose 1.51% on a market value basis. This reflected weakness in the US dollar, which benefited the Fund’s short positioning.
Revenue and Profit Analysis
The Fund aims to generate returns from two main sources:
- Gains/losses from its currency futures trading strategy
- Interest income from its cash and Treasury bill holdings
In Q1 2024, the Fund had a net loss of $0.43 per share. This consisted of:
- Losses of $0.64 per share from currency futures trading as the dollar strengthened
- $0.21 per share of net investment income from Treasury bill holdings
Balance Sheet Analysis
The Fund has high liquidity, with the majority of assets held in cash, Treasury bills and money market funds. This provides collateral for the Fund’s futures trading strategy.
As of March 31, 2024, the Fund had total net assets of $XXX million.
Future Outlook
The future performance of the Fund will depend on trends in the US dollar. If the dollar continues to show resilience and defy expectations for rate cuts, it could lead to further losses for the Fund.
However, if economic weakness overseas boosts the relative appeal of US assets, contributing to dollar weakness, the Fund’s short positioning could generate strong positive returns.
The Fund aims to provide traders and investors with a simple way to access a bearish US dollar futures strategy. It may continue to see fluctuating performance in line with currency market volatility.