Alongside the ongoing global trade saga, markets are increasingly wary of how an escalation of tit-for-tat protectionist measures could hurt consumers in the US and corporate investment. It is hard to imagine world trade would go back to such an extreme scenario. Global supply chains are now highly specialized and delicate. Disruption in one part of the production process could imply a breakdown in the entire process. Ongoing tension is already pushing investors to adopt a more cautious position, as shown by falling bond yields and weak stock performance in recent weeks. This reinforces our long-held view of maintaining a diversified portfolio, mixing equities with fixed income, to manage volatilities and risks.