President Trump’s tariffs have driven market volatility, as measured by the VIX, to levels not seen since the pandemic. Currently, there is a temporary pause on the tariffs (aside from a 10% rate) for every nation except China, but that is not stopping the market from reeling as the world’s two largest economies push tariffs to nosebleed levels.

US Treasury securities have sold off, pushing down their prices and sending bond yields higher. As a result, the correlation between bonds and stocks has risen, leaving investors scrambling to find a place to take shelter.

Alternative investments, especially equity market neutral strategies, may be a useful bunker for investors in this global trade war. Equity market neutral strategies, if executed properly, have the potential to provide positive returns to investors without taking directional risk in the stock market.

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