The Evolution of Asset Allocation

Asset allocation has evolved significantly from its early days when simple models, like the classic 60-40 split between equities and bonds, were predominantly used. Today, investors face a complex array of choices, leading to a more intricate decision-making process regarding the composition of their portfolios. Modern discussions focus on various factors, including the balance between public and private assets, high-quality versus low-quality investments, and the increasing relevance of credit in an era of shifting interest rates. This complexity highlights the need for sophisticated strategies and frameworks that enable investors to effectively navigate the challenges of asset allocation.