Excess Returns The Bull Market You Don’t Want to Believe | Rupert Mitchell on China vs. the Mag Seven
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Nov 7, 2025 Rupert Mitchell, founder of Blind Squirrel Macro, dives into the transformative landscape of China’s markets. He reveals insights from his recent trip, highlighting an 8–10 year bull market potential fueled by industrial recovery and favorable valuations. Rupert addresses the risks posed by AI-driven CapEx from the Mag 7 and contrasts U.S. markets with international equities. He also discusses emerging opportunities in Africa and Uzbekistan, alongside his unique ‘Bushy’ defensive portfolio positioning and insights on the evolving credit landscape.
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Rotate Some Equity Exposure Internationally
- Consider reallocating toward ex-US equities as a multi-year rotation rather than betting exclusively on US mega caps.
- Use valuation and flow shifts to guide marginal portfolio rebalancing away from US concentration.
Bond-Credit Divergence Signals Opportunity
- Bond yields imply the market expects slower growth, while credit spreads remain tight thanks to private credit siphoning weak issuers.
- That creates a potential asymmetric trade if spreads widen modestly under stress.
Run A Tactical Short-Then-Flip Credit Hedge
- Use a low-cost short-junk ETF hedge (e.g., SJB) to wait for a spread widening signal.
- Flip that hedge to long high-yield when OAS spikes toward ~700–750bp to capture attractive yields in an upgraded index.