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Top Traders Unplugged

ALO16: Beyond 60-40... A Bold Approach to Asset Allocation ft. Troy Gayeski

Oct 11, 2023
Troy Gayeski, Chief Market Strategist for FS Investments, discusses asset allocation in a higher yield environment, highlighting the shift from 60-40 benchmark to a 40-30-30 allocation. He explores opportunities in real estate, private equity, and alternatives. The podcast also touches on institutional investor allocation trends and the impact of AI on markets.
01:04:00

Episode guests

Podcast summary created with Snipd AI

Quick takeaways

  • Fluctuations in the yield curve present risk-reward opportunities that can be advantageous for certain investment strategies.
  • Diversification across various strategies and themes is crucial for survival in today's uncertain global landscape.

Deep dives

Steepening yield curve as a risk-reward opportunity

The podcast discusses how fluctuations in the yield curve, such as bull steepeners and bear steepeners, can present significant risk-reward opportunities. The speaker highlights that the current environment indicates a probability of the yield curve steepening, which can be advantageous for certain investment strategies. The extreme levels of inversion in history, excluding the 70s or early 80s, further support this view. The importance of understanding market history and analyzing macroeconomic factors is emphasized in order to identify the best risk-reward profiles in asset classes.

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