The current period of low rates, unprecedented low volatility, lack of dispersion at all levels, and middling non-equity portfolio returns continues to draw investors towards considering multi-asset investment managers. Multi-asset investing generates a good deal of press, ranging from the definition to the proper implementation. For the past several years asset managers have commercially built out capability and rolled out products to meet the interest level. The offerings, historically available to large institutional investors, are now available to a wider swathe of investors in co-mingled and customized vehicles. It is this access by most levels of investors, including private investors, to the “endowment style” of investing employed by the most sophisticated investors that is getting a great deal of attention.
Multi-asset investing can trace its roots back to the balanced funds of the 1920s (some of which still exist) which first incorporated standard, liquid equities and bonds in a single fund. This mix of domestic equities and investment grade bonds in 60/40 weights has certainly stood the test of time and is still a benchmark.