Why portfolios need to evolve, not revolve when it comes to client outcomes

For the past two decades, asset allocation was largely an exercise in rotation. When equity risk premiums compressed, allocators rotated into long-duration fixed income. When growth lagged, they pivoted to value.  This approach worked because the foundational pillar of modern portfolio construction, the reliable negative correlation between equities and bonds, remained intact. Today, market conditions demand a fundamental structural adjustment. The macroeconomic landscape is markedly different than the post-Global Financial Crisis era as a combination of persistent inflation, massive ...