How to stay invested – with safety gear
In markets, policy, positioning and earnings enable participation while buffering against shocks
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AFTER three consecutive years of double-digit gains for US equities till 2025, the first half of 2026 calls for investors to stay invested but to put on some safety gear. In short, they should wear their “PPE”, watch their “CCC” and keep their “FUR” on.
As we see it, there are two forms of PPE: On the factory floor, PPE means personal protective equipment which reduces the risk of injury. In markets, PPE, which stands for policy, positioning and earnings, serve a similar purpose – enabling participation while buffering against shocks.
Policy looks steady enough to avoid a policy-induced downturn. Positioning is stretched, so the task is to rotate, not retreat. Earnings remain healthy, though dispersion is widening as artificial intelligence (AI) disruption separates the wheat from the chaff.
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