00:00Max Ketterner of HSBC writing the recent rotation within U.S. equities isn't the start of a broad risk-off
00:05move.
00:06Instead, a multi-asset and equity models have turned decisively bullish. Max joins us now for more.
00:11Max, welcome. Let's get into that. What's guiding the judgment between one versus the other for you?
00:16Yeah, look, actually, in terms of the data, the one main data point that we've seen in the last six,
00:21seven weeks,
00:21what's changed is that that tiny bit of a sell signal that we had in our positioning framework at the
00:28start of this year,
00:29that has now all but disappeared. So clearly, positioning and also short-term sentiment, short-term hedging demand is much,
00:36much higher.
00:37Sentiment overall, all the price-based, the options-based positioning stuff and positioning proxies are much, much cleaner now.
00:44Even on the systematic side, when we look at the likes of CTAs, momentum signals, risk parity, vol target strategies,
00:50all of those have now gone from around 80th percentile just a couple of weeks ago to below 50th percentile.
00:57So already, much, much cleaner positioning. That, I think, should constrain from here the downside at any kind of positive
01:04news around AI.
01:06You guys were just talking about another funding round for OpenAI.
01:09Any kind of positive news, I think, does call then into question that rotation away from the AI names,
01:15away from the Magnificent Seven, the hyperscalers, in the last two weeks.
01:19I think we've got to answer this option.
01:19you,
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