A trade deal between the U.S. and China will put an end to the rally in risk assets that’s been in place since late December, according to Hondius Capital Management LP’s Shawn Matthews.

“Right now, it’s a risk-on mentality -- you want to be long riskier assets until you get a deal with China,” Matthews. “When that happens you certainly want to be looking to scale back.”

“The bond market is not seeing the follow through,” said Matthews. “If it was truly a risk-on world and people believed it and it was an extended trade, then you would see the 10-year start to back up. That’s a clear sign there’s some concern about what’s going on out there.”