Bond King Jeffrey Gundlach shifts strategy for 2026 amid geopolitical risks and rate uncertainty. The DoubleLine Capital chief investment officer recommends allocating 20 percent to cash and increasing hard assets allocation to 20 percent, up from his previous 10-15 percent guidance. Gundlach warns that stocks face significant pressure if the Federal Reserve raises rates rather than cutting them, contrary to earlier market expectations. He suggests buying gold aggressively if prices fall below $3,500 per ounce, noting that a 25 percent portfolio allocation to bullion would be reasonable. The Iran conflict has elevated oil prices and inflation concerns, reducing rate cut expectations. Additionally, Gundlach is repositioning portfolios for a potential US debt restructuring scenario, replacing higher-coupon Treasuries with lower-coupon alternatives of similar maturity.
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