Tuesday, April 2, 2013

Oliver's Insight: Asset allocation is critical for investors - even as the world mends

Key points in this note:

  • The GFC and the low and volatile returns seen in subsequent years highlighted the importance of asset allocation in determining returns and managing volatility.
  • While a mending global economy will result in better returns, asset allocation will remain critical for investors as returns will likely remain constrained, volatile and lowly correlated.
  • Improved approaches to asset allocation, in particular dynamic asset allocation, and the use of highly liquid and low cost futures and exchange traded funds (ETFs) further enhance the significance of asset allocation

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