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Cadogan Asset Management

Will Trumps Trade Tariffs Effect The Markets?

20 June 2018 11:30

FOR IMMEDIATE RELEASE

Investors- approach the markets with caution. The current climate is liable to be unpredictable and occasionally- volatile. That seems like the overwhelming message that the markets are sending to traders and investors currently.

The last couple of days, have echoed recent movements where Equities have been gyrating between gains and losses predominantly on the back of Donald Trump and his Trade Tariffs.

Recent days have witnessed further tensions arise between President Trump with both Europe and China. This saga still has further potential to both frustrate and rumble forward.

https://www.bloomberg.com/news/articles/2018-06-20/as-trump-punishes-trade-allies-europe-expands-global-alliances

However, could there be a winner rising out of the turmoil?

Well some would say Europe could reap the rewards, and for others- possibly the prudent 'active investor' could be.

Europe this week opened dialogue with Australia in regards to free trade negotiations, meaning the EU now have at least a dozen on going deliberations regarding trade agreements.

This at the same time as America have imposed Tariffs on some of their strongest partners- the EU, Canada, Mexico and Japan.

Whilst the EU has always had excellent transatlantic relationships with America, there is concern currently that Trumps actions may undermine the global economy.

It seems Europe is coming together with the rest of the world, at the same time as America is distancing itself and it's for this very reason that we're witnessing the short term volatility that we are.

So how can an investor approach a climate like this?

Sam Gurung, from the 'Multi Strategy Investment' at Cadogan Asset Management, had the following to say- 'Investors right now are expressing concerns regarding both the volatility in the market, and Trumps actions, but my advice would be- opportunity may present itself during this period.

Even in the short term, if you're an 'active investor' where you're not adopting merely a 'buy and hold' mentality- there are numerous short selling opportunities.

Our trading team have implemented many sell positions on the America Indices as of late.

Therefore, even if you follow what I'd describe as an old school approach, you can hedge this risk by building a small portfolio which both BUYS and SELLS the markets.

Longer term though, even if you're a 'Fundamental' Investor- if this current market rhetoric persists, you may witness European Indices like the Dax in Germany and the CAC in France benefit from this.

We may even see a situation where the above Indices rally, in line with retracements in the Dow, S&P and Nasdaq over in America, and it's why our trading team will be informing our clients to adopt an extremely 'hedged equity basket' moving forward.

Yes, volatility is there. Yes, uncertainty is there. However, by taking advantage of short term movements, and positioning yourself for an eventual resolution- you could have a profitable year and significantly outstrip the general market.

Investors- tread with caution, and consider protecting your portfolio from the many unpredictable movements on the back of Donald Trump and his policy changes.'

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Other Relevant articles:

https://www.bbc.co.uk/news/business-44538385

https://www.theguardian.com/business/live/2018/jun/19/markets-slide-trump-threatens-china-200bn-tariffs-business-live

https://www.ft.com/content/b09fffac-7431-11e8-aa31-31da4279a601

For further information on the Multi Strategy Investment at Cadogan Asset Management, or further market comment please contact Sam on sg@msicadogan.co.uk.


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About Cadogan Asset Management

The Multi Strategy Investment (MSI) is a division within Cadogan Asset Management who work with HNW and UHNW individuals, as well as family offices, pension funds, and other institutions building bespoke portfolios with a multi strategy/ multi market exposure in the derivatives arena.

Although Cadogan Asset Management is a new business; the main principles are not new to the industry with some sixty five years’ of experience between them at other financial services firms. Cadogan is fully authorised and regulated by the Financial Conduct Authority.

The Company also has a Corporate Finance function that sees a specialist division operate in the Oil & Gas sector, along with a business pipeline from the property development and manufacturing industries.

Cadogan currently offers a range of risk rated model portfolio's, becoming more bespoke for larger or more complex clients and these are available either directly managed or through an expanding number of wealth management platforms.

www.cadoganam.com

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