With bonds in a ‘coma,’ buy commodities: Bridgewater’s Patterson

With bonds in a ‘coma,’ buy commodities: Bridgewater’s Patterson
Investors should get out of bonds as rates rise and diversify their portfolios with exposure to agricultural products, oil and metals facing supply disruptions due to the war in Ukraine.
APR 10, 2022
By  Bloomberg

Investors should get out of bonds as rates rise and diversify their portfolios with exposure to commodities such as agricultural products, oil and metals facing supply disruptions due to the war in Ukraine, according to Rebecca Patterson, chief investment strategist for Bridgewater Associates.

“You should absolutely have commodities in your portfolio,” Patterson said during an interview last Friday with David Westin on Bloomberg Television. “We don’t know if bonds as a diversifier are dead or in a coma. I think they’re probably in a coma,” she said on “Wall Street Week.”

Stocks and bonds swung wildly this week as investors sought clues to the economy’s direction, Federal Reserve policy and the impact of the war in Ukraine. The Bloomberg US Aggregate Bond Index is down 7.9% this year through Friday, compared with a 5.8% loss for the S&P 500 Index.

Bridgewater Associates, which oversees $150 billion, posted a 16.3% return in the first quarter as macro funds benefited from volatility in global markets.

Gregory Peters, co-chief investment officer at PGIM Fixed Income, said bonds are getting more attractive as yields rise and provide protection against a potential recession.

“Bonds are increasingly attractive here, not less attractive,” Peters, whose firm had almost $1 trillion under management as of Dec. 31, told Westin. “We’re seeing more alpha opportunities than we have in a long time. So somewhat perversely, we’re pretty excited.”

Latest News

Time to get on the China ETF train? Advisors speak up
Time to get on the China ETF train? Advisors speak up

Chinese stocks have been flying for the past month. Should US wealth managers go along for the ride?

Fidelity reports data breach exposing 77,000 customers' personal data
Fidelity reports data breach exposing 77,000 customers' personal data

The investment giant said Social Security numbers, driver's licenses, and other sensitive information was compromised by a third party using newly established accounts.

Another ex-Edelman advisor joins Baird in Virginia
Another ex-Edelman advisor joins Baird in Virginia

The employee-owned hybrid firm's latest hire in Fairfax reportedly managed $285M at his previous firm.

$26B RIA EP Wealth strikes private market alliance with Opto Investments
$26B RIA EP Wealth strikes private market alliance with Opto Investments

The tech-driven alts platform will provide support to advisors seeking customized portfolio access for their high-net-worth clients.

Advisors' economic optimism slips as pivotal election nears
Advisors' economic optimism slips as pivotal election nears

Growing uncertainty and short-term volatility are weighing on RIAs, with nearly half seeing at least some likelihood of recession.

SPONSORED Destiny Wealth Partners: RIA Team of the Year shares keys to success

Discover the award-winning strategies behind Destiny Wealth Partners' client-centric approach.

SPONSORED Explore four opportunities to elevate advisor-client relationships

Morningstar’s Joe Agostinelli highlights strategies for advisors to deepen client engagement and drive success