The power of diversification in reimagining the 60-40 portfolio
Key takeaways
- Bill Kelly of CAIA argues that investors should rethink traditional 60/40 models by “widening the aperture” on what is included in each of those buckets, incorporating private markets opportunities for potentially better risk management and returns.
- Building diversification is essential for investors, regardless of market conditions. The potential long-term benefits of diversification typically outweigh short-term concerns.
- That said, vintage year - the year in which you invest in a fund - matters in private equity investments, as market fluctuations create different entry opportunities at different points of the economic cycle.
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