Investors are developing a new “Trump trade strategy” to navigate market uncertainties ranging from whether the U.S.-Iran ceasefire will be sustainable to whether oil prices will remain high for an extended period.

As geopolitical developments dominate the economic outlook, predicting global inflation and interest rates is becoming increasingly difficult, making long-term currency transfers challenging.

Instead, many investors are making short-term bets on assets that may have been mispriced during the Iran war.

Here’s a rundown of some of the new Trump trades.

1. HIGHER FOR LONGER OIL

Oil tumbled almost 15% on Wednesday to below $100 a barrel on the ceasefire but the price is expected to remain higher for longer given uncertainty over the Strait of Hormuz.

Oil futures for six months’ time trade ​around $79 , higher than before the war began on February 28.

They have tended to drop sharply on days when a detente looks more likely and ​some analysts say they have swung too low.

Even a successful ceasefire with no further tensions would put a floor under the ⁠oil price of $85 per barrel by year-end, said Societe Generale’s global head of commodities research Michael Haigh, adding that if states now more conscious about energy security ​began stockpiling oil, it would be higher.

That is one reason investors, who have long avoided unloved energy producer stocks, are less bearish. A Bank of America survey dated ​March 31 found that while 30% of investors retain a negative stance on the sector, which is hampered by ESG concerns, this has dropped from 40% six months ago.

Shell (SHEL.L), opens new tab said on Wednesday it sees stronger oil trading ahead.

2. CANADA, NORWAY

The US dollar regained its luster after months of stagnation, but investors noted that if the war ends and demand for the reserve currency decreases, while crude oil prices remain high, the currencies of some oil-producing countries could shine.

Van Luu, head of global solution strategy at Russell Investments, said while addressing a permanent ceasefire scenario, “It will take some time for everything to pick up again, for tankers to start traveling again, and oil prices may reach a higher floor.”

“If oil prices are between 85 and 100 dollars (per barrel), energy exporters in politically stable countries (you can include Norway and Canada in this category) should perform better.” “Petrol prices between $85 and 00 (per barrel) should see energy exporters in politically stable countries (you can include Norway and Canada in this category) perform better.”

3. BOUNCE-BACK OF BONDS?

U.S. President Donald Trump’s truce promise, along with the easing of inflation concerns among energy importers, has led to a decrease in borrowing costs for British and Eurozone governments.

However, fund managers said that these yields are still very high compared to interest rate and inflation expectations, especially considering that the base interest rate in the UK is 3.75%, consumer price inflation is 3.2%, and the 10-year bond yield is slightly below 4.7%.

Morningstar Asset Management portfolio manager Nicolo Bragazza said, “We don’t see a situation similar to 2022 when UK inflation rose above 10%” and viewed government bonds positively.

In the Eurozone, German 10-year bond yields are around 2.9%, compared to interest rates of 2%. Markets are now pricing in only a 20% chance of the European Central Bank raising rates in April, down from 60% before Trump’s Iran ceasefire announcement.

4. HUNTING OUT ANOMALIES

Bragazza said that investors often overreact to good and bad news, which leads to assets that should not be correlated moving together and price anomalies in markets dominated by a war sentiment.

Bruno Taillardat, head of quantitative portfolio management at Edmond de Rothschild, said, “(Trading) is not as widespread as it should be, and there are some sectors that should be less sensitive to it, at least in the medium term.”

It cited global healthcare stocks (which are generally considered relatively defensive during recessionary periods, these stocks have traded in line with the world index of cyclical businesses since the war began).

He said that in sentiment-driven markets, investors who identify mispricing opportunities arising from daily market movements will stand out.

Taillardat stated that he expects Trump’s rhetoric to keep the markets volatile and overly reactive to headlines.

Bragazza from Morningstar said, “These types of asymmetric behaviors create the right opportunities.”