At Schroders, we believe there are two significant downsides to the traditional fixed strategic asset allocation approach used by many investors. Firstly, the timing of when a portfolio commences and the performance of shares over the investment horizon will determine the future outcome, hence the saying ‘timing is everything’. You are unable to control the time you were born or started investing however you can change asset allocations to achieve successful outcomes. Secondly, the inflexibility of asset allocation ranges in a typical portfolio restricts the ability to deliver on objectives. The reason we require greater flexibility in asset class ranges is to respond to changing market environments by selling assets when they are expensive and buying them when they represent good value. In this video we discuss why traditional portfolios need to change. (VIEW LINK)
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