We live in a world in which we are increasingly ‘given the opinions we are supposed to hold’. One antidote to this is to apply the logic of received opinion number one to situation number two. This results in some interesting, if sometimes uncomfortable, results, in effect, rather awkward thought experiments or ATEs as we shall call them.

Almost a year ago when we wrote Spring but not sprung we were worried that the government was too risk averse, but never thought we would still be in lockdown as a second spring arrives with most of the West still ordered to remain at home.

We like to think of the market moving in a variety of ‘herds’, with the opportunities for the biggest herd, the long term investor, being presented by the behaviours of the other two, the Asset Allocators and the short term noise traders.

Market Thinking is subtitled ‘making sense of the Narrative’ because markets are as much about the stories we tell ourselves as any of the so called fundamentals.

March is a key month for most asset allocators, as the options expiry on the third Friday of the month is one of the first major opportunities to ‘reposition’ portfolios by putting on new hedges, rolling existing ones, or allowing them to expire at ‘triple witching’.