Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

Cross Asset Strategy

<ul>
<li>DC company share prices are rolling over, foreshadowing increasing pressure on their hyperscaler customers.  Since the July swoon in semiconductor stocks, the DC sector has underperformed both hyperscalers and semiconductors.</li>
<li>DC players face strong headwinds on multiple fronts, including high leverage/circular financing, supply chain delays, public opposition, and questions about aggressive forecasts of future compute demand.</li>
<li>Leverage is the most prominent risk in the DC sector, with questions looming about completion dates and customers' ability to meet their contracted offtake agreements.</li>
</ul>


DC company share prices are rolling over, foreshadowing increasing pressure on their hyperscaler customers.  Since the July swoon in semiconductor stocks, the DC sector has underperformed both hyperscalers and semiconductors.
DC players face strong headwinds on multiple fronts, including high leverage/circular financing, supply chain delays, public opposition, and questions about aggressive forecasts of future compute demand.
Leverage is the most prominent risk in the DC sector, with questions looming about completion dates and customers' ability to meet their contracted offtake agreements.


DATA CENTER SECTOR: From the Tip of the Spear to Canary in the Coal Mine

Director, Sentiment Matters

Lars Kreckel

Director

The mood of the market, mapped and decoded

Sentiment Matters

Investor sentiment is the overall mood of investors - how bullish or bearish they are on a market or asset.

Sentiment is part of every investor’s investment process. Whether for macro investors, stock pickers, or thematic investors, it matters whether a position is consensus or contrarian.

<ul>
<li>
Buy Side Sentiment Tracker: we aggregate asset-allocation views from 54 top asset managers across 73 assets, based on 1,400+ individual views.</li>
<li>
Bullish, but not extreme: Risk appetite is high and rising, yet equity downgrades and resilient sovereign demand show the Buy Side is far from universally risk-on.</li>
<li>
Max Contrarian: Infrastructure, Industrial Metals and Gold are most popular; Swiss Franc, Cash and Consumer Staples are least popular.</li>
</ul>



Buy Side Sentiment Tracker: we aggregate asset-allocation views from 54 top asset managers across 73 assets, based on 1,400+ individual views.

Bullish, but not extreme: Risk appetite is high and rising, yet equity downgrades and resilient sovereign demand show the Buy Side is far from universally risk-on.

Max Contrarian: Infrastructure, Industrial Metals and Gold are most popular; Swiss Franc, Cash and Consumer Staples are least popular.


Sentiment Matters: Buy Side Sentiment Tracker - October 2026

<ul>
<li>
Treasuries Sentiment has turned sharply bearish, but not extreme. The SMA sits around the 30th percentile, still above its historical buy threshold.</li>
<li>
The underlying picture is mixed. Momentum and some speculative positioning are very bearish, while buy-side sentiment, options, analyst expectations and flows remain closer to neutral.</li>
<li>
This is not broad capitulation. Price action has been persistently poor rather than disorderly, leaving room for sentiment to deteriorate further before a stronger contrarian signal emerges.</li>
</ul>



Treasuries Sentiment has turned sharply bearish, but not extreme. The SMA sits around the 30th percentile, still above its historical buy threshold.

The underlying picture is mixed. Momentum and some speculative positioning are very bearish, while buy-side sentiment, options, analyst expectations and flows remain closer to neutral.

This is not broad capitulation. Price action has been persistently poor rather than disorderly, leaving room for sentiment to deteriorate further before a stronger contrarian signal emerges.


Sentiment Matters: US Treasuries Bearish, But Not Capitulation

<ul>
<li>Analysts at JP Morgan and Goldman Sachs say oil flows from the Middle East are nearly back to normal, with JPM putting it at 98%.</li>
<li>
Shipping data, tanker rates, and oil prices directly contradict the Wall Street narrative.  </li>
<li>Unlike during the brief truce in June, none of the indicators show that oil flow is increasing.</li>
</ul>


Analysts at JP Morgan and Goldman Sachs say oil flows from the Middle East are nearly back to normal, with JPM putting it at 98%.

Shipping data, tanker rates, and oil prices directly contradict the Wall Street narrative.  
Unlike during the brief truce in June, none of the indicators show that oil flow is increasing.


STRAIT OF HORMUZ IS BACK TO NORMAL....REALLY???: Wall Street's Slippery Narrative

Asset Allocation & Fund Positioning, Copley Fund Research

Steven Holden

Asset Allocation & Fund Positioning

Copley Fund Research

Copley Fund Research provide research and data on asset allocation among Global and Emerging Market equity funds.  The analysis details absolute and relative positioning across countries, sectors and industries together with highly granular data on single stock and single fund allocations.  The data is updated monthly with time series going back to January 2011.

Global Research - Analysis of 165 prominent Global equity funds, combined AUM $335bn
GEM Research - Analysis of 127 prominent global EM equity funds, combined AUM $250bn

Asset Allocation - Global and GEM Equity

<ul>
<li>Chips &amp; Memory is now the largest theme in active Global funds, at 9.70% of the average portfolio versus 8.96% for Hyperscalers.</li>
<li>AI Build-out accounts for 24.4% of the average fund, well ahead of AI Adoption at 14.7%.</li>
<li>Ownership is spreading into memory stocks, but both leading themes remain underweight the benchmark. Rising exposure does not represent a uniform buying wave</li>
</ul>


Chips &amp; Memory is now the largest theme in active Global funds, at 9.70% of the average portfolio versus 8.96% for Hyperscalers.
AI Build-out accounts for 24.4% of the average fund, well ahead of AI Adoption at 14.7%.
Ownership is spreading into memory stocks, but both leading themes remain underweight the benchmark. Rising exposure does not represent a uniform buying wave
