Portfolio under regime change

Duration is your single biggest portfolio dial. Extending duration into a cuts cycle is the canonical late-cycle move; doing it too early is the canonical mistake. The right approach is to stagger — scale duration in over months as the regime confirms, rather than trying to call the pivot exactly.

Because the moves you make at regime turning points have an outsized effect on a decade of returns. Most retail portfolios are built once and never rebalanced for regime — which is fine in stable regimes and very expensive at turning points.

Hiking cycle

short duration

Restrictive pause

begin staggering

Cuts confirmed

extended duration

Cuts cycle late

begin shortening