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Brazil's Hedge Funds Switch Tactics on End of Bold Rate Hike Cycle

  • SPX Capital, Ibiuna Investimentos bet on falling Brazil rates
  • Central bank said it will assess the need for additional hike
The Central Bank of Brazil in Brasilia, Brazil.

The Central Bank of Brazil in Brasilia, Brazil.

Photographer: Andressa Anholete/Bloomberg

After profiting from one of the world’s most aggressive monetary tightening cycles, some Brazilian money managers are switching tack and starting to bet on the opposite trade.

SPX Capital, whose Raptor fund is beating 99% of peers this year, and Ibiuna Investimentos, which manages more than 30 billion reais ($5.9 billion), have built positions that benefit from falling rates in Latin America’s largest economy. Genoa Capital, a fund launched in 2020 by Itau Unibanco Holding SA asset-management unit veterans, scrapped payer positions -- which gain from rising rates -- last month.