Investors are likely to favor gold and technology stocks as those bets are expected to provide a buffer against the possibility of a US recession this year, according to strategists at JPMorgan Chase & Co.
The trade defined as “long duration” is expressed by being overweight on gold, growth stocks such as technology companies and currencies (short USD), strategists including Nikolaos Panigirtzoglou and Mika Inkinen wrote in a note, adding the bet is far from crowded in rates due to the highly inverted yield curve.
“The US banking crisis has increased the demand for gold as a proxy for lower real rates as well as a hedge against a ‘catastrophic scenario,’” they wrote.
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