Investors have learned that Trump’s trade policies may not always be as extreme as they seem, leading to the emergence of the “TACO trade” theory. However, experts warn that this approach could backfire and embolden Trump in his trade war efforts. The president recently announced new tariffs on Japan, South Korea, Brazil, and Canada, causing some market turbulence. Despite this, investors remain optimistic, with the S&P 500 and Nasdaq hitting all-time highs. However, concerns about overvaluation persist, with the US stock market being deemed expensive compared to historical norms. Inker suggests that deep value and non-US developed market stocks may offer better opportunities.

Read more at Yahoo Finance: How the TACO trade could end up backfiring on investors