Archive

May 20, 2025
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Trump Doctrine: All Talk And No Trousers

  • Despite the frenetic activity in the international arena that we have seen from the US in recent weeks, whether in trade or diplomacy, showmanship continues to trump substance, thereby posing real risks for policymakers and investors alike.

By Alastair Newton

May 14, 2025
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USD Bears Broke The Bandwagon

  • Investors ask whether threats to the USD’s reserve currency status are resting or dead, whereas we wonder if it was ever alive. Commentators routinely overextend narratives.
  • The USD share of allocated FX reserves is already trending downward. A potential acceleration from smaller deficits and higher tariffs would partly offset the impact.
  • Fuller hedging of USD asset holdings abroad may have already reached its limit. We still see more attractive mispricing elsewhere, such as excessively dovish rate curves.

By Philip Rush

May 12, 2025
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Oil: How Low Will It Go?

  • Riyadh’s acceleration in unwinding cuts to oil output is now widely seen as a drive to squeeze out high-cost producers, especially US shale. However, no matter how low the price of crude oil goes, tariff-related economic uncertainties make success no more certain than it was in 2014-16.

By Alastair Newton

May 07, 2025
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Trading Inside Trump’s Collar

  • Market volatility is closely tied to US politics, where unfriendly measures can cap equity prices, while reversals limit potential falls, creating a political floor and ceiling.
  • Attempts to avoid all losses lose relevance if they can reverse swiftly. Hedging against falls in the SP500 beyond recent lows better matches the risk of a recessionary crash.
  • Selling year-end upside above 5750 covers the insurance cost and nets a 3.8% return, with price losses and gains capped at 7% and 6.4% by this “Trump Collar” strategy.

By Philip Rush

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