The simultaneous liquidity expansion by the Fed and PBOC historically benefits Risk Assets and Hard Assets.

1. AI Infrastructure & Power Grids

• Logic: The shift to AI inference requires massive computing power and grid modernization. This intersects US tech growth with global manufacturing recovery.
• Top ETFs:
  • SMH: Semiconductors (Nvidia, TSMC)
  • GRID: Smart grid equipment and transformers
  • XLU: Utilities (increasingly valued for data center power supply/nuclear)

2. Industrial Metals (Commodities)

• Logic: PBOC infrastructure stimulus + Weaker USD = Rally in raw materials, specifically Copper (electrification) and Lithium (EV recovery).
• Top ETFs:
  • COPX: Copper miners (high leverage to copper prices)
  • LIT: Lithium & Battery tech (high sensitivity to China’s recovery)
  • DBC: Broad commodities (Inflation hedge)

3. Chinese Big Tech

• Logic: Historically low valuations combined with regulatory easing and direct liquidity injections make this sector a prime target for mean reversion.
• Top ETFs:
  • KWEB: China Internet giants (Tencent, Alibaba)
  • CQQQ: Broad Chinese technology sector

4. Bitcoin (Liquidity Proxy)

• Logic: Crypto has the highest correlation with Global M2 (money supply) growth, acting as a “liquidity sponge” and hedge against fiat debasement.
• Top ETF:
  • IBIT: Spot Bitcoin ETF