The co-founder and former chief investment officer of Pacific Investment Management Co. has been growing increasingly vocal in recommending the strategy, which involves betting on the outcome of corporate takeovers.
In-tandem moves between stocks and bonds in recent months are reigniting a debate over the hedging power of Treasuries in an era where both asset classes are both prone to selloffs amid concerns of further Federal Reserve tightening.
History suggests that the surge in yields is probably just a detour. But that doesn’t mean it won’t hurt.