Investors uncover vast national debt as hedge funds triumph over asset allocators in their preferred AI stock.

To stay ahead, here’s what you need to know today: hedge funds are winning in the bond market, while asset allocators are losing. The chart of the iShares 20 Plus Year Treasury Bond ETF shows that long bond yields are rising, contrary to the belief of asset allocators who have been buying long-term bonds. Hedge funds have been short selling these bonds, leading to an increase in yields. The recent rise in yields is due to concerns about the U.S. national debt. While hedge funds are currently winning, it is advised to focus on high-quality bonds with shorter durations or use bond ETFs as tactical positions rather than strategic ones. Chinese bonds and stocks have been performing poorly, with the potential for a housing crisis and increasing defaults in the shadow banking market. On a positive note, Applied Materials reported strong earnings, indicating a growing demand for semiconductors. However, caution is advised in buying tech stocks due to the general downward trend. Money flows are negative for several stocks and ETFs, while the momo crowd is buying gold and oil. Bitcoin has experienced aggressive selling and is trading at a lower price. The overall stock market indicator is negative, and it is recommended to hold existing positions while also allocating cash to short-term tactical trades and hedges. For a traditional 60/40 portfolio, it is not favorable to allocate to long-term bonds, and instead, focus on high-quality bonds with shorter durations.