Global Asset Allocation Update – September 2018

Global Asset Allocation Update – September 2018

By |2018-09-10T16:11:22+00:00September 10th, 2018|Alhambra Research, Global Asset Allocation Update|

The risk budget is unchanged again this month. For the moderate risk investor, the allocation between bonds and risk assets is 50/50.

Decoupling anyone? That’s what the market is whispering right now, that the recent troubles in foreign economies is contained and won’t affect the US. The most obvious example of that trend is the performance of US stocks versus the rest of the world. I am painfully aware of the divergence in performance as I have had the temerity to try and diversify my portfolio away from very expensive large-cap US stocks. That has been a mistake for going on a decade now and one has to wonder if diversification is still the free lunch Harry Markowitz thought. The bill for continuing to believe it prudent to own a variety of assets has been particularly steep this year.

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