Transformation of the 60/40 strategy: new asset configuration
After the turbulence of recent years, balanced portfolio funds are returning to the top: the correlation between stocks and bonds has returned to negative, providing much-needed protection against volatility.
Upgraded 60/40 model:
- Promotions (50%): Weightening overvalued tech giants in favor of global dividend aristocrats.
- Bonds (35%): High-quality sovereign and corporate bonds with an attractive yield of 5+%.
- Alternative assets (15%): Including commodities and private lending to protect against unexpected inflationary spikes.
Backtesting results
The upgraded portfolio delivers an average annual return of 8.2% while reducing the maximum historical drawdown by 38% compared to the standard equity index.