The New 60/40
- Asset allocation models must evolve to accurately reflect the global investing environment
- Investors must be willing to pursue international equities and bonds
- Alternative assets and specialized equities may help protect against inflation
By Arthur P. Steinmetz / President and Chief Investment Officer
We believe asset allocation models must evolve. The New 60/40 must be more globalized, more diversified and more nimble, to expand the growth opportunity set, potentially generate real income and manage specific risks.
Structural changes in the global economy are gradually rendering traditional portfolio construction strategies obsolete. A typical asset allocation model of 60% domestic equities and 40% high grade bonds no longer reflects the breadth of opportunity in the world. Moreover, it is unlikely to provide many of the diversification benefits it once did.
How to Invest Using the New 60/40
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