Anthony Rayner: Is diversification dead?

The number-one question we are asked by clients is how to structure a truly diversified multi-asset portfolio when bonds are so expensive. This is closely followed by concerns about high valuations across financial markets in general. Both of these points relate directly to concerns about preserving capital. The hierarchy of risk in multi-asset funds tends to be dominated by equity risk. This is currently the case, so it is right to consider how to diversify that. What is certain is it will not always be the same asset class that is the best diversifier, as the behaviour of asset classes...