Hansa House View

Ever the showman, this was intended as the starting point of Trump’s grand re-negotiation. Being a selfdescribed master negotiator, Trump always likes to go in with a maximalist approach before settling somewhere in the middle. The reaction from markets persuaded him to delay the implementation of the tariffs to allow time for negotiation with most countries willing to acquiesce to some degree. Where these negotiations ultimately end up is still uncertain but markets have responded positively to the apparent softening of Trump’s opening gambit.

In a more volatile world the question of portfolio positioning becomes increasingly pertinent. As long term investors we have a default position of being fully invested, predominantly in equities. Our time horizon allows us to ride out volatility which is what we thought the market reaction to ‘liberation day’ was. We have long favoured the US market due to its entrepreneurship, innovation and willingness to change when needed. All of these advantages remain but we are concerned that higher valuations and its populist pivot make it less attractive than it was.