What is global macro?
Global macro is a hedge or mutual fund strategy that bases its holdings on a country's overall economic or political state. For example, a fund manager may decide to sell short stocks on the AUD if it looked like Australia was heading for recession.
Where have you heard about global macro?
The global macro strategy has been adopted by many corporations, with best-known global macro funds including George Soro's Quantum fund and those run by Caxton Associates and Moore Capital. The largest and most reputable is Bridgewater Associates with $120+ billion under management.
What you need to know about global macro.
Global macro fund portfolios are built based on predictions and projections of events related to country-wide, continental or global positions in terms of economy, history or international relations. The strategy typically involves analysing and forecasting interest rate trends, political changes, government policies, international trade and payments and other inter-government relations in a bit to capitalise on macroeconomic and geopolitical trends. Global macro funds can involve any type of available security including long and short positions in various equity, currency and fixed income.