Market Opportunity - Agent-managed vaults are able to identify real-time market opportunities [1] - aiAVAX earned depositors over 30% on their AVAX due to a sAVAX carry trade [1] - The sAVAX market discount was around 0.55% due to sellers needing instant liquidity [1] Strategy - The strategy involved acquiring sAVAX at a discount and unwinding it over 14 days via BenqiFinance [1] - The strategy may not always be viable as a singular approach [2] - aiAVAX is prepared to capitalize on the best yield opportunities for depositors in the future [2]

Core Insights - The message from prominent figures in finance emphasizes buying during market unease rather than chasing rallies driven by greed [1][2] - The Fear and Greed Index currently indicates a level of 20, reflecting fear in the crypto market [2] - The collapse of Japan's carry trade, a significant factor in global asset inflation, is highlighted as a critical issue [2][3] Market Dynamics - The Bank of Japan's recent rate hikes have led to government bond yields exceeding 1.7%, a level not seen since 2008, impacting the carry trade [3] - As borrowing costs rise, investors are facing increased yen liabilities while their foreign asset positions decline, leading to forced liquidations [3] Bitcoin Metrics - Bitcoin's Net Realized Profit and Loss is retreating towards the zero line, indicating a potential end to forced selling and the beginning of a stable phase [4] - Current Bitcoin prices around the $90K level suggest a balance between buyers and sellers, indicating a truce in the market [4][5] - Analysts describe the current market state as an equilibrium zone, where investors are reassessing their investment strategies [5] Accumulation Phase - If Bitcoin's Net Realized Profit and Loss remains above zero, it could signal the start of a stronger recovery base [5] - Recent price movements show Bitcoin slipping below significant historical levels, suggesting that investors are returning to accumulation [5]

Core Insights - The author has extensive experience in executive management, particularly in insurance/reinsurance and the Asia Pacific markets, with a focus on climate change and ESG [1] Group 1 - The author holds an honours degree in economics and politics, emphasizing economic development [1] - The author has 36 years of experience in executive management, indicating a deep understanding of market dynamics [1] - The author's investment activities are conducted in a personal capacity, suggesting independence in analysis [1]

Group 1: Carry Regime and Market Dynamics - The "Carry Bubble" framework suggests that major commodity cycles are influenced by a broader carry cycle, which is characterized by leveraging low-yielding currencies to invest in higher-yielding assets [3][4][5] - Carry trades are reliant on stable conditions and often yield small, steady gains until volatility disrupts the market, leading to significant losses [6][8] - The current market environment reflects a carry regime where large companies and growth stocks outperform value stocks, driven by low rates and low volatility [8][9][10] Group 2: Transition from Carry to Anti-Carry - Carry regimes are inherently unstable and tend to unwind abruptly, often triggered by shifts in monetary policy or significant increases in volatility [12][13][14] - Historical patterns indicate that major shifts in monetary regimes have consistently ended carry bubbles and initiated bull markets in resource equities [17][18][19] - The current administration's approach to monetary policy suggests a potential regime shift, which could lead to a rotation from carry-dependent assets to undervalued resource equities [19][20] Group 3: Natural Resource Equities - Natural resource equities typically struggle during carry regimes but may become attractive as the market transitions to an anti-carry environment [10][12] - The shift from carry to anti-carry could lead to a resurgence in resource equities, as capital flows back to assets with real scarcity and cash flow [25][24] - Historical examples show that after previous carry bubbles, resource equities gained significant market share, indicating a potential for similar outcomes in the current cycle [23][18] Group 4: Gold and Oil Market Dynamics - Gold has been a strong performer, with prices rising significantly, while the market is beginning to see a shift towards oil as a new opportunity [30][36] - The current gold-oil ratio indicates that oil is undervalued compared to historical standards, suggesting potential for a rally in oil prices [54][56] - The supply dynamics for oil are tightening, with non-OECD production growth slowing, which could lead to a significant price increase in the near future [56][62] Group 5: Commodity Price Trends - Commodity prices showed modest rebounds in the third quarter of 2025, with the Goldman Sachs Commodity Index rising by 1.3% and the North American Natural Resource Index advancing by 10.9% [58] - Precious metals, particularly gold and silver, have outperformed other commodities, with gold prices increasing by 16% and silver by 30% in the third quarter [75] - The agricultural sector has seen mixed price movements, with corn prices expected to face downward pressure despite a potential bottoming out in the market [94][96][102]

@BenWerkman We're live!https://t.co/JeyY7xK6lrHorizon (@JoinHorizon):"I look at this dip and I don't see anything out of the ordinary" - @BenWerkman– Bitcoin’s price action and liquidity– Strive’s perpetual preferred equity model– Applying the USD → BTC carry trade at scaleWatch the latest episode of Over The Horizon ↓ https://t.co/FmdHQTYKJ6 ...

Market Analysis - Bitcoin's price action is considered within the ordinary range despite a dip [2] - Discussion of Bitcoin's liquidity [2] Investment Strategies - Exploration of Strive's perpetual preferred equity model [2] - Examination of applying the USD to BTC carry trade at scale [2]

Market Trend & Potential Risk - Bitcoin mirroring a Japan-style carry trade crash could wipe out retail investors [1]

Summary of Key Points from J.P. Morgan's Global Markets Strategy Call Industry Overview - **Industry**: Foreign Exchange (FX) Market - **Company**: J.P. Morgan Core Views and Arguments - **Bearish Outlook on USD**: J.P. Morgan maintains a bearish view on the US dollar, citing stagflationary trends in US data, declining real yields, and concerns regarding Federal Reserve independence as key drivers [4][12][38] - **Market Conditions**: Despite recent dollar price action being disappointing, the underlying conditions for USD weakness remain intact, with expectations for a dovish Fed stance that could further weaken the dollar [9][10][12] - **FX Trading Themes**: - Preference for bearish USD against cyclical currencies, particularly mid- to low-yielders [4][12] - Carry-efficient USD shorts, particularly against currencies like NOK, AUD, and MXN [4][12][28] - Fiscal differentiation in developed markets (DM), favoring currencies with fiscal surpluses [4][28] Key Currency Insights - **G10 Currency Targets**: - EUR/USD target at 1.22, USD/JPY at 142, and USD/CAD downgraded to 1.34 [4][12] - Emerging Markets (EM) targets include USD/BRL at 5.60 and USD/MXN at 18.50 [4][12] - **Regional Preferences**: - Overweight positions in EUR, Scandis, and Antipodeans in developed markets [4][12] - In EM, overweight positions in MYR, THB, HUF, ZAR, TRY, and ILS [4][12] Important but Overlooked Content - **Stagflationary Data Trends**: The US is experiencing a stagflationary evolution, with employment growth slowing while inflation remains firm, leading to a deterioration in real policy yields [14][15] - **Fed's Upcoming Decisions**: The upcoming FOMC meeting is critical, with potential implications for USD based on the Fed's sensitivity to labor market conditions and inflation risks [18][38] - **Legal and Political Risks**: Ongoing legal issues surrounding Fed independence and tariff policies could impact the dollar's performance, with significant implications for market sentiment [39][40] Conclusion J.P. Morgan's analysis indicates a cautious but strategic approach to currency trading, emphasizing the importance of macroeconomic indicators and central bank policies in shaping FX market dynamics. The firm advocates for a bearish stance on the USD while identifying specific currency pairs and regions that present potential opportunities for investors.

Market Overview - The S&P 500's equity risk premium has reached zero, indicating a potential bubble in the market [1] - Massive investments in data centers are reminiscent of the tech boom, with concerns about sustainability and reliance on a single client, OpenAI [2][3] Investment Strategy - The company is adopting a defensive stance in equity investments, acknowledging the risks associated with current market exuberance [4][3] - There is a cautionary approach towards tech stocks due to potential reversals in the Japanese carry trade, which could impact US tech investments [8][7] Japan's Economic Policy - Japan's current policy rate is approximately 0.5%, with expectations for a 25 basis point increase, which could reverse the carry trade [6][7] - An increase in Japanese interest rates may negatively affect US tech stocks, as Japanese investors may withdraw funds from the US [8] China Market Insights - The company has allocated about 10% of its funds to China, indicating a belief in the potential for growth despite being underweight in the US [10] - Chinese stocks are considered cheap, and the government is showing a willingness to support rising share prices, which is crucial for investment [11][12] Housing Market in China - The Chinese housing market requires a clearing of excess capacity, and while lower interest rates may help, significant government intervention may be necessary [17][19] - The government could potentially buy excess housing for social purposes, which would significantly impact the market [19] Electric Vehicle (EV) Sector in China - The company is currently avoiding investments in the Chinese EV sector due to concerns about excess capacity and market consolidation [20][22] - There is an expectation of consolidation in the automobile market, and the company is looking for potential acquisition targets among struggling firms [21][22]

Market Trends - Hong Kong interest rates are surging, disrupting the previously top-performing carry trade [1] - Local authorities implemented a cash squeeze to alleviate pressure on the city's long-standing currency peg [1]