Recently, I noticed an interesting phenomenon. A fixed income fund manager managing nearly $5 billion in assets has been continuously accumulating Venezuelan bonds since mid-last year. His logic is quite clear: he believes that recent political changes in Venezuela send a positive signal to bond investors, which will drive bond prices higher.

Honestly, actions by such large funds speak volumes. It’s important to note that Venezuelan bonds have been undervalued in the market for a long time, with prices suppressed heavily. But if there is a political turnaround, these mispriced assets indeed have room for a rebound. The investment manager’s view is that—bond valuations are expected to gradually return to reasonable levels.

From an investment perspective, this reflects institutional investors’ proactive positioning. They are betting not only on the bonds themselves but also on the expectation of an improvement in Venezuela’s situation. If this expectation materializes, early investors will be able to reap the benefits of this value recovery. That’s also why large funds are willing to keep increasing their positions at this point—they see an opportunity that the market has not fully priced in yet.