NEW YORK, Sept 27 (Reuters) - As the Federal Reserve’s hawkish stance boosts Treasury yields and slams stocks, some investors are preparing for more pain ahead.
AQR's analysis showed that trend-following hedge funds tend to outperform when rates are elevated, as they hold large cash positions that benefit from higher rates.
Of course, plenty of investors believe the Fed will cut rates as soon as economic growth starts to wobble.
Futures tied to the Fed’s key policy rate show investors pricing in the first rate cut in July 2024.
Still, he has been holding off on adding to the firm’s holdings of small-cap consumer stocks, wary there may be more market volatility ahead as investors digest higher rates and other factors, including elevated energy prices.
Persons:
”, Jake Schurmeier, Dan Villalon, Keith Lerner, Lerner, Robert Pavlik, Schurmeier, he’s, Eric Kuby, Lewis Krauskopf, David Randall, Carolina, Ira Iosebashvili, Leslie Adler
Organizations:
Fed, Apple, Nvidia, Treasury, U.S ., Harbor Capital Advisors, AQR Capital Management, Advisory Services, Reuters, Dakota Wealth Management, BofA Global Research, Nasdaq, North Star Investment Management Corp, Thomson
Locations:
Harbor