Multi-Asset

Five factors to fear?

While many balanced investors are understandably worried about low returns becoming the ‘new normal’, we believe that allocating smartly can more than offset the drag that structural challenges could exert on portfolios.
September 2020

Multi-Asset Solutions Team

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Risk Disclaimer 

Views and opinions have been arrived at by BMO Global Asset Management and should not be considered to be a recommendation or solicitation to buy or sell any products that may be mentioned.
The value of investments and any income derived from them can go down as well as up and investors may not get back the original amount invested.

While many balanced investors are understandably worried about low returns becoming the ‘new normal’, BMO Global Asset Management believes that allocating smartly can more than offset the drag that structural challenges could exert on portfolios.

Risk Disclaimer

Views and opinions have been arrived at by BMO Global Asset Management and should not be considered to be a recommendation or solicitation to buy or sell any products that may be mentioned.

With extraordinary central bank intervention likely to keep government bond yields anchored at ultra-low levels, investors in traditional balanced portfolios are faced with the prospect of much lower returns. Indeed, for a typical asset mix comprising 60 per cent equities and 40 per cent aggregate bonds, average annual returns could, according to some estimates, drop to 3.5 per cent in the 2020s from around 10 per cent in the previous forty-five years. We are less pessimistic and see opportunities in markets that our Sustainable Multi-Asset Income Fund, with its dynamic asset allocation approach and rigorous stock selection, can exploit to help our clients meet their goals.

The value of investments and any income derived from them can go down as well as up and investors may not get back the original amount invested.

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