The Peak Trump Conundrum

The report analyzes the 'Peak Trump' theory, suggesting that the US dollar index's decline is likely ending as political and legislative headwinds are now priced in. It recommends hedging against potential dollar strength and increased volatility via risk reversals.

Key Takeaways

• 1.The 'Peak Trump' concept suggests that the US dollar's recent 11% decline may be ending as negative catalysts are already priced in.
• 2.Prediction markets indicate a high probability of Democrats winning the House and the Supreme Court ruling against Trump's tariffs.
• 3.Historical midterm data suggests that loss of House control often leads to elevated risk aversion and higher US yields.

Table of Contents

• The "Peak" Trump concept
• A review of historical midterm price performance
• Research disclaimers

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