Portfolio Risk Mitigation without Bonds
With the Fed fighting inflation and US Treasury bonds down more than 10% since the market top, how to handle the trillion-dollar bond problem is becoming more relevant for investors.
Dr. Michael Stamos, Head of Global R&D Multi Asset, flags this challenge in a study that was published in the March edition of The Journal of Portfolio Management.
He argues that government bond securities no longer seem to be the only obvious option for a crisis risk offset. Aside from this traditionally used “sheet anchor”, which reasonable risk management alternatives could help investors reduce their downside?
The article provides a thoughtful comparison and critical assessment of the opportunity cost and risk-reduction potential of several strategies that could help mitigate the portfolio risks of investors searching for alternative avenues to sovereign bonds.
