Alexander Tapia @alexddtl1: "📊 Portfolio Positioning & Market..."

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📊 Portfolio Positioning & Market View (Dec 2025) • $ALAB (Astera Labs Inc) 11.79% • $NBIS (Nebius Group NV) 11.78% • $AMD 8.9% • $SOFI 8.72% • $APP 6.87% • $STRL.US 6% • $META 5.63% • $CIFR 5.56% • $OSCR 5.13% • $PLTR 4.41% • $SMCI 3.84% • $UNH 3.69% • $NVDA 3.36% • $EOSE 3.23% • $HIMS 3.12% • $IREN (Iris Energy Ltd) 3% • $CNC 2.14% • $XBI 1.97% • $BMNR 0.87% 📉 November Recap: A Tough Month for the Portfolio November ended as a negative month for the portfolio, mainly due to the sharp correction across several AI-related names — an area where we continue to hold meaningful exposure. In my previous positioning update, I mentioned that a pullback in the sector was not unlikely given elevated expectations ahead of earnings and how overcrowded the trade had become. However, the correction did not come from weakening fundamentals or a broad slowdown in the sector. Instead, the sell-off was driven by fear: concerns about a potential AI bubble, questions around the massive capex cycle (funded by strong cash flows for hyperscalers and, in other cases, by elevated debt issuance), and debates around chip depreciation and useful life. This fear was amplified by broader macro pressures: • Tighter global liquidity • Worries about a potential unwinding of the Japanese carry trade as JGB yields rose and the yen weakened • A repricing of Fed rate-cut expectations, which added more uncertainty to risk assets 💡 Tech Earnings Confirmed: Fundamentals Remain Solid Despite the noise, tech earnings showed that fundamentals remain intact. Demand continues to surprise both analysts and the market, and growth across AI-linked businesses remains robust. Because of this, I view the correction as healthy — a reset that allowed the market to reassess expectations and valuations in a sector where sentiment had become extremely optimistic. With the recent repricing, the market once again expects a 25 bps cut in December. If this view holds, I expect the recovery in AI to be gradual and selective, benefiting companies that became oversold despite maintaining strong fundamentals. ⚠️ Key Risks Going Into December 1️⃣ Japanese Bonds & Carry-Trade Unwind Risk The main near-term risk is that Japanese bond yields continue to rise ahead of the BoJ decision, increasing fears of an unwind in the yen carry trade. This could pressure both crypto and equities, amplifying negative sentiment. The recent price action, however, has been constructive. The market is beginning to differentiate crypto weakness from equity weakness, allowing selective buying in beaten-down stocks. Institutional investors have already taken advantage of the pullback by increasing positions in AI names such as $NBIS , $IREN and $ALAB — a positive sign for sentiment. 2️⃣ Fed Decision & Volatile Rate-Cut Expectations Rate-cut expectations in the past month have been extremely volatile — shifting from expecting a cut in December, to removing it entirely, and now pricing it back in as delayed economic data (due to the shutdown) revealed further weakness. My base case is a hawkish cut: ➡️ The Fed cuts 25 bps, ➡️ but pairs it with a message of caution, emphasizing the need to pause and monitor upcoming data, maintaining a “data-dependent” stance. With the market highly optimistic about future cuts, such a message could weigh on equities and risk appetite immediately after FOMC. 📊 Macro Data Still Supports a More Dovish Fed The data released so far does justify a more accommodative Fed stance: • Labor market weakness continues to build • The shelter component of inflation keeps softening • No meaningful pass-through from tariffs yet • And recent tariff cuts on goods by the Trump administration should help headline inflation moderate further All of this supports inflation continuing to converge toward the midpoint of the target range, increasing the likelihood of more cuts next year. Still, important data is missing due to the shutdown. This is why several Fed members argue that cutting “blind” could be risky. A large part of equity performance and risk appetite will depend on the incoming data — and especially on how it reshapes expectations for 2026 rate cuts. $SPY (SPDR S&P 500 ETF) $QQQ (Invesco QQQ) $TLT (iShares 20+ Year Treasury Bond ETF ) $VXX (iPath Series B S&P 500 VIX Short-Term FuturesTM ETN) $BTC $BIL (SPDR Bloomberg 1-3 Month T-Bill ETF)