Geopolitical shocks often don't move markets the way they should, as investors often raise cash first and ask questions later due to investor positioning. In the days following the first U.S.-Israeli strikes on Iran, gold and European defence stocks fell nearly 4% following the conflict, with European defence stock prices dropping nearly 4%. This was seen as an opportunity for investors to raise cash during these crises. The author suggests that while gold has historically been a safe store of value in turbulent times, conflict typically drives demand for military equipment. This explains why assets that would benefit from a given shock can fall the fastest. Gold was trading nearly 30% above its 200-day moving average just before the Middle East conflict began, the most extreme of any major financial asset, according to Bank of America data. However, this weakness was likely not driven by a fundamental shift in investor sentiment, the author argues. The article also notes that South Korean chip stocks have also sold off sharply since the start of the conflict due to their high-profile rise in AI hardware.