2025 Market Outlook: Seizing Opportunities Amid Shifting U.S. Trade Policy

When Rumors Rule: Capturing Alpha in a ‘Fake News’ Market

In a year already shaped by shifting rhetoric around trade policy, 2025 promises to bring new opportunities for tactical investors and traders alike. Today's headlines from the Washington Post suggested that President-Elect Trump is considering limiting his envisaged tarrifs to a small set of “critical sectors” within defense, medical, and energy-production supply chains. This report included a concise list of strategic targets, ranging from steel, iron, and aluminum to syringes, needles, vials, key pharmaceutical inputs, batteries, rare-earth minerals, and solar panels.

Such a modest roster of goods, if subject to tariffs, would likely have had a negligible impact on broader trade flows or inflation expectations. This scenario would keep pressure off the Fed to maintain higher rates for longer and could thus create a supportive environment for risk assets—particularly when combined with any corporate tax initiatives that prioritize economic growth over government overspending.

Yet, the resulting market movement underscores just how sensitive investors have become to each new pronouncement or rumor. The U.S. dollar softened following the Washington Post report, while risk assets such as the Russell 2000, NASDAQ, S&P 500, and Dow all advanced. However, President-Elect Trump swiftly denied the claims on X, calling the post Fake News. This reversal points to a dynamic we expect to persist throughout the year: volatile “Trump trades,” with markets vacillating between fear and optimism on any given headline or social-media post.

At Audhild, we anticipate further episodes of heightened market sensitivity in 2025, providing fertile ground for short- to medium-term trading strategies. Whether one opts to “fade the rallies” or “buy the dips,” the key will be proactive monitoring of institutional positions, crowd psychology, and the overall preparedness of market participants to enter or exit positions on short notice. Investors and traders who stay abreast of the facts, evaluate capital flows, and understand when to step into or out of the market will likely find ample opportunities to generate alpha.

By contrast, traditional long-only strategies or purely long/short hedge fund plays may not offer the same level of flexibility. In an environment shaped by unpredictable policy shifts—and occasionally sharp turnarounds—the ability to pivot quickly is paramount.

You are welcome to request to review to our investor presentation which outline our strategy and approach to the markets in 2025. And you're welcome to join Audhild's journey as we navigate stormy markets and generate above-market returns for Audhild.

Happy new year and happy trading.