Georgios Fatouros @GeorgeFatouros: "📊 𝗣𝗼𝗿𝘁𝗳𝗼𝗹𝗶𝗼 & 𝗠𝗮𝗿𝗸𝗲𝘁..."

Greece

📊 𝗣𝗼𝗿𝘁𝗳𝗼𝗹𝗶𝗼 & 𝗠𝗮𝗿𝗸𝗲𝘁 𝗖𝗼𝗺𝗺𝗲𝗻𝘁𝗮𝗿𝘆 – 𝗠𝗮𝗿𝗰𝗵 𝟮𝟬𝟮𝟲 Hello everyone, This past week reshaped the geopolitical landscape. The US-Israel joint strikes on Iran, the killing of Iran's Supreme Leader, retaliatory strikes across the Gulf, and the effective closure of the Strait of Hormuz shocked global markets. 𝗠𝗮𝗿𝗸𝗲𝘁 𝗜𝗺𝗽𝗮𝗰𝘁 This was a broad risk-off event. No region was spared: • $IWM (Ishares Russell 2000 ETF) 𝘮𝘪𝘯𝘶𝘴 𝟰.𝟬𝟮% — US mid/small caps hit hardest on growth fears • $FEZ (State Street SPDR EURO STOXX 50) 𝘮𝘪𝘯𝘶𝘴 𝟳.𝟵𝟴% — Europe punished by energy exposure and proximity to the conflict • MSCI 𝘮𝘪𝘯𝘶𝘴 𝟯.𝟬𝟳% • VIX surged above 29, WTI broke above $90/bbl — highest since late 2023 The market is pricing a geopolitical supply-risk premium in energy, which transmits through higher oil inputs slowing disinflation, elevated rate volatility, and a classic shift toward lower beta and higher-quality cash flows. 𝗣𝗼𝗿𝘁𝗳𝗼𝗹𝗶𝗼 𝗣𝗲𝗿𝗳𝗼𝗿𝗺𝗮𝗻𝗰𝗲 Our portfolio was not immune. March return stands at 𝘮𝘪𝘯𝘶𝘴 𝟱.𝟳𝟲%, impacted mostly from the same growth names that delivered our strong YTD performance (+𝟭𝟬.𝟳𝟲%, compared to roughly 𝘮𝘪𝘯𝘶𝘴 𝟭.𝟳% for $SPY (State Street SPDR S&P 500 ETF)). Drawdowns during geopolitical shocks are normal. 𝗪𝗵𝗮𝘁'𝘀 𝗡𝗲𝘅𝘁 — 𝗠𝗼𝗻𝗱𝗮𝘆 𝗥𝗲𝗯𝗮𝗹𝗮𝗻𝗰𝗲 On Monday, I will implement our scheduled rebalancing. Our system's latest signals are 𝗰𝗼𝗻𝘀𝗶𝘀𝘁𝗲𝗻𝘁 𝘄𝗶𝘁𝗵 𝘁𝗵𝗲 𝗿𝗲𝗴𝗶𝗺𝗲 𝘀𝗵𝗶𝗳𝘁 we're seeing the rotation points toward 𝗹𝗼𝘄𝗲𝗿-𝗯𝗲𝘁𝗮, 𝘃𝗮𝗹𝘂𝗲-𝗼𝗿𝗶𝗲𝗻𝘁𝗲𝗱, 𝗱𝗲𝗳𝗲𝗻𝘀𝗶𝘃𝗲 𝗻𝗮𝗺𝗲𝘀 adjusting positioning based on data, not emotion. The base case from most institutional research is that this conflict will be relatively contained in duration. But the distribution of risks has shifted, and tail scenarios such as prolonged Hormuz disruption, sustained $100+ oil cannot be ignored. I'll share the rebalance details once implemented. — George

Not investment advice. The author may have financial interests in the mentioned instruments.

3 Mentioned

IWM

Ishares Russell 2000 ETF

FEZ

State Street SPDR EURO STOXX 50

SPY

State Street SPDR S&P 500 ETF

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