IMPACT ON OIL, MONETARY NORMALIZATION AND CARRY IN VOLATILE MARKETS

The conflict in the Middle East and the Federal Reserve’s stance shape exposures and diversification strategies.

In recent weeks, markets have continued absorbing macro shocks, with the Fed signaling a prudent pace of normalization.The Middle East conflict pushed up oil prices and risk premiums, affecting importers and increasing volatility. Emerging economies gained traction, especially LatAm, thanks to commodities and stronger balance sheets.

Nautic Invest maintains a balanced stance: operational liquidity, disciplined diversification, and simple hedges to weather shocks and capture carry when opportune. Governance ensures swift and coordinated decisions.

MACRO ENVIRONMENT IN TRANSITION: PORTFOLIO RESILIENCE

In February, markets continued to show resilience against a macro framework that remains challenging. Inflation moved toward containment, and the Federal Reserve hinted at a gradual pace of normalization, suggesting modest rate cuts that are highly dependent on ongoing developments. This environment kept volatility contained, while interest in emerging market assets strengthened.

Oil, driven by the Middle East conflict, heightened geopolitical attention and risk premiums, with effects differentiated by each region’s energy dependence. LatAm emerges as a standout region within emerging markets, benefiting from higher commodity prices and relatively solid macro and corporate balances.

Our strategy continues to favor USD exposure to developed economies, maintaining diversification toward LatAm within global portfolios, aiming to capture the regional recovery without exposing the portfolio to risks that today do not generate additional spreads. The U.S. monetary policy, becoming less restrictive, supports a more stable carry, while conditions in China and Europe are monitored.

This view rests on three pillars: sufficient operational liquidity to navigate shocks, diversification with uncorrelated asset classes that dampen movements, and simple hedges that limit losses in the face of unexpected twists. Governance, with periodic reviews and clear communication with the board, facilitates swift action in response to changes in outlook.

For the coming months, the focus will be on data from the United States, Europe, China, and Chile to adjust exposures in line with macro developments. Maintaining disciplined rebalancing and vigilance of geopolitical and fiscal risks, including government shutdown episodes, will help sustain value and capitalize on opportunities as the dynamics of 2026 become clearer.

At Nautic Invest, prudence translates into strategy and, when appropriate, coordinated action to protect and grow our clients’ wealth.

This approach seeks to turn uncertainty into a window of opportunity for companies and their owners in Chile and the region.