Gillian Hutchison: Should you be allocating to real assets?

Traditional asset classes have enjoyed a remarkably strong innings for many years. As an example, a portfolio consisting of 60% in global equities and 40% in global government bonds would have generated a total return of around 7% a year (compounded) over the past 25 years (source: Waverton Investment Management, based upon the FTSE All-World Total Return and FTSE World Government Bond indices, in sterling terms). Fixed income contributed meaningfully to this fine outcome - for example, the 10-year gilt began this period with a yield above 8.5% and it now resides at around 1.3%. This mov...