Investing in bond funds hedge funds adjust macro strategies by

Hedge funds adjust macro strategies by increasing exposure to investment-grade bond funds, reflecting conviction in the defensive positioning of fixed income assets. Once you’ve figured out your ideal asset allocation, the next step is deciding what to invest in. A solid starting point for domestic equities is an ETF that tracks the S&P 500. These funds offer broad exposure to 500 of the largest U.S. companies, historically averaging around 10% annual returns. They’re low-cost, not actively managed, and provide instant diversification. “A Fed cutting cycle usually supports duration, but the long end can still back up if sticky inflation persists, Treasury supply remains heavy, or a rising term premium develops,” says Knotts. Market strategists note that investing in bond funds is gaining traction among institutional players, particularly in investment-grade debt, as equity P/E ratios stay elevated versus historical medians.