Fed signal sends advisers into fixed-income scramble


June 21, 2019

“Kenneth Waltzer, co-founder and managing director of KCS Wealth Advisory, is not completely convinced that a recession is coming, but is “hedging in both directions” just to be safe.

“We’re very late cycle, but it’s not clear if we’re at a point where money will be tightening or is the Fed really going to reverse because the cycle is even later and we’re nearing a recession?” he said. “My feeling is we’re going to reaccelerate, and the Fed won’t need to cut rates, or we’ll have one-and-done.”

Mr. Waltzer is hedging the risks he sees by lowering the exposure to riskier bonds and sticking with shorter-maturity bonds.

“It doesn’t make sense right now to reach for yield or reach for duration, so we’re staying short,” he said.”

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