Market volatility is back with a bang. Given the US equity correction, Chinese markets turning negative year-to-date, and ongoing oil price volatility, it would be easy to think everything that could go wrong has done so this year.
Whether it has or has not remains to be seen of course, although we believe despite the risks, the market gyrations represent opportunities to rebalance and selectively add to mid-risk assets. Given that a multi-asset investor's risk-profile typically aligns to their long-term attitude to risk, it makes sense to correct any drift in portfolios caused by these broad market swings. The importance of correcting drift is often overlooked. Looking back over history, a portfolio of 60% equities and 40% bonds from 1998 to 2013 was significantly higher than the weighted sum of the total retur...
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