Ruffer investment director Matt Smith has told advisers he believes that balanced portfolios are a dangerous thing to be invested in at this point in the economic cycle.
Speaking at Professional Adviser's latest working lunch event on Wednesday (14 April), Smith said balanced portfolios have duration risk on both sides of the equation. "The bond portfolio has more duration risk than ever before, for lower reward than ever before," he said. "But the equity part of your portfolio also has very significant duration risk because of the degree to which investors have re-rated growth stocks in particular, which account for a larger percentage of the market than ever before." Smith said it was "low and stable inflation" that had permitted this. "Irrespect...
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