Kolanovic: 3 reasons why this can squeeze higher
1. No communism…..As of only a few days ago, Sanders appeared highly likely to secure the nomination (e.g. odds plunged from 65% to 16% now). We think yesterday’s results are likely not fully priced in the market

2. Rate cuts outlive COVID………A possible scenario is that the COVID-19 epidemic subsides in early spring, while US rate cuts, weaker USD, steeper yield curve, and large fiscal stimulative measures in China and elsewhere remain intact for much longer

3. Positioning clean…..Volatility targeting equity positioning is now in the ~5th historical percentile, i.e. there is relatively little further to be sold by volatility targeting funds. Trend-following equity exposure is estimated to be in ~25th percentile, i.e. below average. Also, Hedge Funds’ equity beta is ~10th percentile