Lead-Lag Live

Beyond Traditional Diversification with Brad Barrie

Jul 26, 2025
Brad Barrie, portfolio manager for the Dynamic Alpha Macro Fund at Dynamic Wealth Group, redefines diversification in investing. He likens portfolio construction to baking the perfect cookie, emphasizing that true diversity involves blending non-correlated assets, not just stocks and bonds. Barrie introduces a multi-dimensional approach that leverages global macro strategies, showcasing how factors like weather can impact prices irrespective of market trends. His insights aim to help investors navigate volatility and optimize long-term performance with innovative asset allocation.
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INSIGHT

Cookie Analogy for Diversification

  • Building an asset allocation model is like baking a cookie requiring both great ingredients and a great recipe.
  • Combining high-quality investments with strong allocation strategies results in a truly diversified portfolio.
INSIGHT

Two Colors of Diversification

  • Traditional portfolios often show many asset colors but effectively have only stocks and bonds.
  • During market stress, correlations merge so diversification fails and portfolios behave like a single asset.
ADVICE

Add Non-Correlated Assets

  • Add truly non-correlated assets like global macro strategies to enhance portfolio diversification.
  • Don't rely solely on bonds; diversify with alternatives that have different economic drivers for resilience.
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