There's a popular nickname for how to play Trump trade policy: the "TACO Trade." But investors have mixed opinions about whether it's a safe bet.

Enter the TACO trade: “Trump Always Chickens Out.” It’s a market phenomenon that’s played out twice in the last two months, delivering sharp rebounds for traders who had the courage to buy the dip after each of President Trump’s tariff threats.

TACO, short for "Trump Always Chickens Out" — drew a sharp reaction from the president. Questioned about it in the Oval Office, Trump denied backing down and called the label “a nasty question.” Investors coined the term to reflect a pattern: Trump threatens tariffs,