Investors have encountered experienced several periods of severe market turbulence since the global financial crisis – most notably the European sovereign wealth crisis, the ‘taper tantrum’, and the initial stages of the Covid-19 pandemic.
Fortunately, the sharp drawdowns experienced proved on each occasion to be temporary, and the bull run for stocks and bonds ultimately resumed. With numerous asset classes performing positively in unison since 2009, most multi-asset approaches - including the traditional 60/40 portfolio - largely delivered on long-term investor return objectives. In addition, due to the largely sanguine environment during the 2010s, portfolio diversification - which is perhaps the primary attribute of a multi-asset solution - was only infrequently put to the test. The Big Question: How and where to...
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