The risk feels that it's asymmetric at this moment. If we have a peace deal, we could have a relief rally. On the other hand, if we don't have tangible evidence of actions that could shorten the duration of the disruption, then current risk pricing is not consistent with the double disruption that energy markets are pricing right now.

Our energy investors are telling me that we have already lost about 10% of global oil supply, 20% of global LNG supply. Driving this inconsistency could be the buy-the-dip flow dynamics. Flows into US equity ETFs have been going up since the beginning of the conflict, even though sentiment is plummeting.

We have flattened our equity directional exposure to neutral while leaning into thematic megaforce themes. No matter what happens, every company, every government globally is going to be very focused on energy security, energy independence, and also supply chain and infrastructure security.

We're in a supercharged version of that world shaped by supply. You look at what has worked during this period of volatility. It hasn't been gold, it was not government bonds. Real assets have actually been working better as a diversifier.

We already preferred US equities over Europe and Asia equities through most part of the conflict so far. This adjustment is really just to flatten that directional movement across equity exposures.

We want to square the directional exposures by being neutral across equities at the moment because of the blow-by-blow volatility coming from headlines. It is impossible to predict the next announcement.