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FYI: DoubleLine Chief Investment Officer and CEO Jeffrey Gundlach seeks yield while keeping risk low. If you're looking to crown someone the Bond King, DoubleLine Capital chief investment officer and CEO Jeffrey Gundlach — also a manager of several of its mutual funds — is a prime contender Regards, Ted http://license.icopyright.net/user/viewFreeUse.act?fuid=MjAxMjE2ODY=
IBD: What's your most contrarian position right now?
Gundlach: Probably that if the Fed does start to raise interest rates, the day they raise rates you want to sell all of your high-yield (corporate) bonds and start to buy Treasuries.
IBD: Spell that out, please.
Gundlach: Historically, contrary to most people's strongly held opinion, you have never succeeded in owning junk bonds vs. Treasuries when the Fed is raising interest rates. But if you sold high-yield bonds and bought Treasuries, you were able to reverse that trade at a profit at some time in that tightening cycle.
Most people think that when the Fed raises rates, it means they have some super secret information about the economy, that things are really booming and everything's going to be great. But the facts don't back that up.
The high-yield bond market will exhibit a much higher default rate during a rising Fed Funds environment than it would during a falling interest-rate period.
Interesting how the two funds he touts (Core and Total) and discusses the strategies of lag PONDX. I know they are not quite directly comparable, but still.
Anna will probably know the answer to that.
Certainly glad JG is involved in the bond part of DSENX.
DLFNX is mine, from among his funds. Glad I did. Uncle Jeffrey is a guy too smart for me. I want someone who knows, almost intuitively, what to do. I'm not adding, these days, though. I'm over 40% bonds and I will be adding to my equities in the IRA.
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Anna will probably know the answer to that.
Certainly glad JG is involved in the bond part of DSENX.