Preparing portfolios from a variety of market outcomes with a broader allocation
A portfolio mix that combines both traditional and alternative investment strategies - such as managed futures and equity market neutral - may be better positioned for a variety of scenarios across markets and asset classes.
What this chart shows
Traditional investment strategies such as long-only equity and fixed income securities generally add value and earn a positive return in some market environments. In higher volatility environment, strategies such as managed futures may perform better.
What it means for investors
Rounding out a core portfolio with alternative investment strategies can help investment portfolios weather and potentially benefit from a broader range of market outcomes, while also managing volatility, which is particularly important in uncertain economic times.