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

Global Equities, Multi-Asset PM, Dantes Outlook

Damanick Dantes, CMT

Global Equities, Multi-Asset PM

Dantes Outlook

We invest over a full market cycle, using multi-asset portfolios tailored to each global client, from individuals to family offices.

Built to Endure

<ul>
<li>Global equities and commodities contributed to gains throughout our portfolio suite, driven by positive selection effects.</li>
<li>Aggressive strategies continue to outperform their respective benchmarks YTD, especially as tech and crypto stabilize.</li>
<li>Positioning carries over into September, maintaining an underweight to bonds and overweights to global stocks and commodities.</li>
</ul>


Global equities and commodities contributed to gains throughout our portfolio suite, driven by positive selection effects.
Aggressive strategies continue to outperform their respective benchmarks YTD, especially as tech and crypto stabilize.
Positioning carries over into September, maintaining an underweight to bonds and overweights to global stocks and commodities.


Portfolio Update: Selective in Global Stocks, Commodities, Underweight Bonds

<ul>
<li>The US unveiled new policies to impose secondary sanctions on countries that have trade or other relationships with Iran.  These policies assert US control over any nation's financial sovereignty.</li>
<li>
Iran's most consequential trading partner is China, and the US has not sanctioned any major Chinese company or bank because of the risk of "blowing up the global economy."</li>
<li>As in the military conflict, the US is overplaying its hand and risks substantial global economic consequences by pursuing short-term, impulsive policies rather than proper negotiations to achieve long-term objectives.</li>
</ul>


The US unveiled new policies to impose secondary sanctions on countries that have trade or other relationships with Iran.  These policies assert US control over any nation's financial sovereignty.

Iran's most consequential trading partner is China, and the US has not sanctioned any major Chinese company or bank because of the risk of "blowing up the global economy."
As in the military conflict, the US is overplaying its hand and risks substantial global economic consequences by pursuing short-term, impulsive policies rather than proper negotiations to achieve long-term objectives.


Trump's Iran D-Day: Why "Operation Economic Outcast Is D.O.A."

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>We rank more than 350 Global equity funds using our proprietary Quality framework to identify the highest-quality portfolios, which we classify as Quality Leaders.</li>
<li>Quality investing is driven more by stock selection than large country or sector bets, with broad ownership of Microsoft, Alphabet, TSMC and NVIDIA across Quality Leader portfolios.</li>
<li>Quality comes at a price. Despite owning many of the world’s strongest businesses, Quality Leaders have been the weakest-performing group over the past five years.</li>
</ul>


We rank more than 350 Global equity funds using our proprietary Quality framework to identify the highest-quality portfolios, which we classify as Quality Leaders.
Quality investing is driven more by stock selection than large country or sector bets, with broad ownership of Microsoft, Alphabet, TSMC and NVIDIA across Quality Leader portfolios.
Quality comes at a price. Despite owning many of the world’s strongest businesses, Quality Leaders have been the weakest-performing group over the past five years.


<ul>
<li>President Trump is pressuring nations to sign a Loyalty Pledge to the US for their AI future.  The pledge aims to counter the rapid growth of open-weight Chinese AI models.</li>
<li>Nations that agree to the AI Pledge risk compromising their digital sovereignty.  This concern was underscored recently when the United States restricted foreign nationals' access to Anthropic's latest AI models.</li>
<li>If the US can convince countries to join its US-controlled AI ecosystem, it would pose a powerful mechanism to co-opt them into future conflicts driven by US geopolitical interests.</li>
</ul>


President Trump is pressuring nations to sign a Loyalty Pledge to the US for their AI future.  The pledge aims to counter the rapid growth of open-weight Chinese AI models.
Nations that agree to the AI Pledge risk compromising their digital sovereignty.  This concern was underscored recently when the United States restricted foreign nationals' access to Anthropic's latest AI models.
If the US can convince countries to join its US-controlled AI ecosystem, it would pose a powerful mechanism to co-opt them into future conflicts driven by US geopolitical interests.


US/CHINA AI WAR: State of Play & AI Sovereignty Decisions