Thanks Peter, always interesting notes. I'm with you on short equities, trying to identify what assets have not corrected enough vs those that have corrected too much on forced positioning squaring. I running short spooz vs long SFRz6 at c.3x hikes priced for 2026. if the Fed get anywhere near realising vs whats priced US stocks will have to price lower (in the current context and without a miraculous zero impact on econ growth/jobs). A swift resolution will see the hikes taken out pretty quickly which will hedge the prem loss on the ESm6
Binary markets often show up when liquidity becomes the primary transmission channel instead of fundamentals.
When financial conditions tighten or ease quickly, positioning adjusts faster than earnings expectations can.
It makes markets look headline-driven on the surface, but underneath itโs usually a regime shift in liquidity.
Feels like weโre still trading that channel right now rather than a traditional growth cycle.
Thanks Peter, always interesting notes. I'm with you on short equities, trying to identify what assets have not corrected enough vs those that have corrected too much on forced positioning squaring. I running short spooz vs long SFRz6 at c.3x hikes priced for 2026. if the Fed get anywhere near realising vs whats priced US stocks will have to price lower (in the current context and without a miraculous zero impact on econ growth/jobs). A swift resolution will see the hikes taken out pretty quickly which will hedge the prem loss on the ESm6
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