Richard Stroud @Richardstroud: "COPIERS AND FOLLOWERS UPDATE Hi everyone,..."

United Kingdom

COPIERS AND FOLLOWERS UPDATE Hi everyone, it's been a while since my last update, so here is a summary of what has been happening and what we can expect to see in the near-term. Firstly, blink and you'll have missed it - the market turmoil that Trump's "liberation day" tariffs caused has now been reversed and the S&P 500 is almost back to positive territory for the year. In fairness, the markets had been falling prior to April 2nd, but nevertheless it has been a strong rebound from stocks. The main event that started the turnaround was when Trump announced the 90 day suspension on all additional tariffs. Bond yields had been rising sharply which probably forced his hand to a certain extent. Bonds are again plummeting and I will talk more about this further down. The other main catalyst of the current stock euphoria are the trade deals the U.S has negotiated with the U.K, but in particular China, essentially cutting all but the basic trade tariffs trade between the two world superpowers. However, a lot of analysts are in agreement that this stock market surge is overdone, as tariffs levels and general uncertainty amongst businesses are far higher than before the start of April. We can be fairly sure that we will see more volatility as the weeks pass by and more trade negotiations and ramifications present themselves. For instance, in the last 30 minutes or so Trump has just recommended a 50% tariff be put on the European Union due to the slowness of trade negotiations, which has further riled markets, so we can expect some more ups and downs to come in the markets. One longer term issue which is starting to present itself is the increasing worry over the U.S's debt and deficit levels, especially if Trump's tax cuts come to fruition with no reduction in spending. U.S government bonds, especially the longer-term ones, have fallen a fair bit in the last couple of weeks, which has been underlined by credit agency Moody's downgrading the U.S one notch lower than the perfect AAA score. To be clear, the U.S is highly unlikely to ever default on its debts, but the decrease in sentiment over the U.S's fiscal position have caused bond yields to rise, with the 20 year rate now topping 5%. Having cleared our bond positions at a small profit before the market rout, I am starting to look again at once again adding a bond position to the portfolio now prices have fallen and yields are starting to look very attractive. We have cash on the side-lines after cashing in some profits in a couple of positions, so this is something I will be monitoring over the next few weeks. The positions sold from the portfolio recently were $ADM (Archer-Daniels-Midland Co) for around a 25% profit, after warning signs over the difficulties U.S agriculture is facing from the current trade situation. We also cashed in a good short term profit of nearly 70% from our $BTDR (Bitdeer Technologies Group) position, selling now due to it nearing analysts price target for the stock. We have had a good spell coming out of the first dip and whilst the S&P 500 isn't quite positive for the year, we are around 3% higher as of today. As I have mentioned before we can expect more ups and downs to come, but I am positive moving forward how we are positioned and am hopefully going to put our remaining funds to use should bonds continue to fall. Wishing you all a great weekend and please stay posted for more updates. Best wishes, Richard.

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

2 Mentioned

ADM

Archer-Daniels-Midland Co

BTDR

Bitdeer Technologies Group

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