Another volatile session in the bond markets Wednesday after New York Federal Reserve president William Dudley scaled back the prospect of a September rate hike, calling the idea "less compelling" than a few weeks ago, in light of the recent global market turmoil.

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Most U.S. treasury bond prices strengthened on Dudley's comments, erasing earlier losses.

Benchmark 10-year Treasury notes were up 3/32 in price for a yield of 2.122 percent, down 1 basis point from late on Tuesday. They were down as much as 10/32 earlier, hitting a one-week high in yield at 2.168 percent.

So how do you play the $12.6 trillion Treasuries market in light of Dudley's dovish comments and continued worries about China's economy?

Laird Landmann is one of four managers for the $66.7 billion MetWest Total Return Bond Fund for bond giant TCW.

He told CNBC's "Power Lunch" Wednesday many investors will start to radically rethink risk preferences in their portfolios.

"Fundamentals are stretched, risk is rising, liquidity is terrible and a 'great deleveraging, or massive reduction in the level of U.S. debt, is on the horizon. We've been in the sunshine for years so it's not surprising, actually, to expect one."

Landmann said in preparation for the deleveraging ahead, his fund has lightened up on corporate credit and high yield. "We are cutting risk in structured products, like commercial mortgage backed security and and non-agency CMBS, as well."

Another part of the market Landmann suggests avoiding is emerging market bonds. "The recent cracks in the global market these past few sessions is yet another example of why emerging markets will lead the impending deleveraging cycle."

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MetWest Total Return Bond Fund (i) holds a five star rating from Morningstar. The one year return is up over 3.67 percent and up 10.28 percent over the past five years.

Landmann is part of the TCW fixed income team that has been nominated 8 times for Morningstar’s Fixed Income Manager of the Year award and winning in 2005.

TCW manages approximately $180 billion across fixed income, equities, emerging markets and alternatives