As investors reassess the effectiveness of a 60/40 portfolio, a recent paper from KKR explored the “regime change” that is underway. Namely, KKR has urged investors to examine a 40/30/30 portfolio consisting of equities, bonds and private assets, respectively. Within the bucket of private assets, KKR highlighted real estate, infrastructure, and private credit as options. Ultimately, the authors concluded that their 40/30/30 mix offered a particularly strong performance within a high-inflation environment. Read it here.
The strongest approach for asset selection and allocation remains a fierce topic of debate among CIOs and managers within pension funds, hedge funds and endowment systems.
With that, Ashby Monk, who serves as executive director for Stanford’s Research Initiative on Long Term Investing, is adamant that meaningful performance will revolve around an effective operating model.
For the June edition of Chronicles, we're highlighting Ashby's feature in Portfolio for the Future™ and unpacking how to develop strategies that will yield the most alpha in today’s volatile investment arena: