Great ‘Bear Market’ in Diversification Haunts Wall Street Pros

  • 📰 YahooFinanceCA
  • ⏱ Reading Time:
  • 69 sec. here
  • 11 min. at publisher
  • 📊 Quality Score:
  • News: 59%
  • Publisher: 63%

Meb Faber News

Bloomberg,Asset-Allocation,Diversified Portfolios

(Bloomberg) -- They did everything right — spreading out bets far and wide across bonds and equities in case things went south. Now, after heeding Wall...

-- They did everything right — spreading out bets far and wide across bonds and equities in case things went south. Now, after heeding Wall Street’s mantra to diversify for the long haul, these investors are watching with envy as the US stock rally leaves them in the dust yet again.Scholz’s SPD Suffers Record Rout in Germany’s EU Vote

Faber calls the last 15 years a “bear market in diversification.” His $54 million Cambria Global Asset Allocation ETF has trailed the S&P 500 in all but one year since its inception despite an annualized 5% gain. American stocks have been on a blistering run since the global financial crisis, outpacing almost everything in a period when bond returns were suppressed during the zero-rate era while international stocks languished under the weight of a strong dollar. Up 14% annually, the S&P 500’s gain is double that of stocks in developing countries and adds up to three times as large as investment-grade bonds.

“Diversification is your best friend on your worst day,” said David Kelly, chief global strategist at J.P. Morgan Asset Management. “The right asset allocation is a little bit like home insurance. You never know when you’re going to need it, but you should never feel comfortable not having it.” “The question everyone has is, does it make sense to diversify?” said Mayukh Poddar, senior portfolio manager at Altfest Personal Wealth Management. “A lot of people have become more focused on equity market returns in the post-Covid era.”

Inflation is likely to stay sticky, making bonds exposed at a time when the government ramps up Treasury supply to meet fiscal needs, according to David Rogal, a portfolio manager at BlackRock Inc.

 

Thank you for your comment. Your comment will be published after being reviewed.
Please try again later.
We have summarized this news so that you can read it quickly. If you are interested in the news, you can read the full text here. Read more:

 /  🏆 47. in BUSİNESS

Business Business Latest News, Business Business Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

Great ‘Bear Market’ in Diversification Haunts Wall Street ProsThey did everything right — spreading out bets far and wide across bonds and equities in case things went south. Now, after heeding Wall Street’s mantra to diversify for the long haul, these investors are watching with envy as the US stock rally leaves them in the dust yet again.
Source: BNNBloomberg - 🏆 83. / 50 Read more »

Stock market today: Wall Street slips ahead of job market dataNEW YORK (AP) — U.S. stocks drifted lower as investors await a trove of labor market data this week. The S&P 500 fell 0.2% in early trading Tuesday. The Dow Jones Industrial Average fell 148 points, and the Nasdaq slipped 0.1%.
Source: SooToday - 🏆 8. / 85 Read more »

XRP under bear watch: Market sentiment sways toward a price fallXRP bears dominated the market last week as its price dropped during that period and things might get worse soon.
Source: CryptoAmb - 🏆 22. / 68 Read more »