Examining the Short Book
The Blind Squirrel's 'Monday' Morning Notes. Year 4; Week 11 of 2026.
In case you missed it, in last week’s guest edition of Benny & The Squirrel we were joined by Nico Hoyt to discuss the current set up in agricultural commodities. Important topic in these troubling times. Check it out 👇.
I will get straight to the point this week. It does not require great powers of observation to conclude that risk assets (ex-energy) are having a rough war.
The 🐿️ started getting worried about risk in early February, exiting long-held (and previously much-loved) uranium positions and adding hedges to protect a large emerging markets overweight (now greatly reduced). By mid February we were in full de-grossing mode and it feels like we have been reaching for a stack of pink (sell) tickets every day since.
Sometimes, you never sell enough. The 🐿️’s BUSHY™ (beta portfolio) is now 5.06% below its end-February high water mark (+11.95%) - a bigger drawdown than created by ‘Liberation Week’ last April.
Comparing the composition of BUSHY™ today with the start of the year (image below), you can see just how defensive the portfolio has become even if the cash position was reduced partially with the addition of the “Malthus Ag Basket” this week. If the situation in the Middle East continues to fester, I am more than happy to de-gross further.
The cash weighting would be even higher were it not for the (long only) portfolio’s hedge book. Further analysis and action items for BUSHY™ will be in tomorrow’s ‘Start the Week’ note. Right now, I want to focus on the other side of any length in risk assets.
I am going to spend some time taking stock of that exotic cocktail of slop bowls, ‘Hogs’, predatory lenders, science projects and SaaS-acre™ victims that is the 🐿️’s Acorn short book.
