Deep Dive: Private markets could be the future of 60/40 portfolios

Split between traditional and revamped model

When 2022 saw the biggest bonds sell-off in a generation, many called it the end of the 60/40 portfolio model.

This was because, unusually, the negative correlation between equities and bonds reversed and both assets began falling at the same time. However, claims that the events of 2022 marked the 'death' of such a longstanding model were an "exaggeration", according to James Klempster, deputy head of the Liontrust multi-asset team. Investors cautiously turn to Europe as US credibility falters under Trump's tariffs He said there were several factors that lead to this "unusual positive correlation" three years ago, but at its heart, it was the result of inflationary shocks as consumers emba...