Psigma's Becket: 'Cautious' is now a prehistoric term

Traditional cautious vehicles have become "basically prehistoric" in their approach to portfolio construction, according to Tom Becket, chief investment officer at Psigma Investment Management.

Becket (pictured) said years of monetary stimulus had turned low risk, higher yielding assets into high risk, lower yielding assets. As a result, cautious investors, historically used to allocating between sovereign and investment grade debt and developed market equities, must pursue "diversification and innovation", he suggested. "It has never been more difficult to be a cautious investor. In fact the term 'cautious' is now basically prehistoric as the ravaging and distorting effects of central bankers have eliminated the return potential of most traditionally cautious investment cho...