DX And NLY: A 13.6% Yield Barbell Strategy For Turbulent Times

2026-03-09 13:45:45 ET

Investment thesis

For many investors, spring has been a difficult start, the economic backdrop is turbulent, the news feeds are flooded with various reports, and everything from domestic political battles to events in Iran. Even though the S&P 500 only lost 1.14% in value over the week, some assets took a serious hit. Besides the skeptics who keep saying that the AI bubble is about to burst, new issues related to private lending have popped up. The CLO funds faced problems caused by rising default rates and increased credit risks. First, Blue Owl Capital ( OWL ) sold its $1.4 billion loan portfolio , and then BlackRock ( BLK ) imposed restrictions on withdrawals from its private lending fund , both of which can only be seen as signs of serious problems in this area. All this is in addition to the fact that the start of military operations in Iran caused spot oil prices ( CL1:COM ) to rise by 27.91% over the week. Furthermore, on Friday, labour market data was published showing that the unemployment rate had increased to 4.4% and that the number of jobs created was lower than the number of jobs lost (by 92,000 in February). And that's even though wages are going up, so with oil prices pushing up energy costs, there's a growing risk of inflation....

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