To the first point, markets incorporate vastly more information than anyone is aware of. We don't know all of the relevant realized outcomes that investors are reacting too, but there's way more than just what's in the news.

To the second point, I would first want to know if the variance in that strategy is the same. If it's greater, then I'd submit risk aversion might be part of the answer. There are more factors going into prices than just expected value.