Partner Insight: Diversification proves its worth as markets reset

Diversification has long underpinned multi-asset investing – and its importance is only growing as markets move through a period of adjustment. Rising interest rates, shifting correlations and concentrated equity performance reignited a debate over the relevance of traditional 60/40 portfolios.

According to Dimitris Korovilas, Senior Investment Strategist at Vanguard, global bonds have regained their role as an effective shock-absorber, while higher yields have improved their long-term return outlook. At the same time, the dominance of US equities has prompted investors to revisit the value of global exposure, both across and within asset classes.

Korovilas cautions against the temptation to chase past winners. Concentration may amplify returns in the short term, but it undermines resilience.

 In a world of unpredictable policy shifts and persistent volatility, broad diversification remains one of the most effective defences against uncertainty.

Read the full article to explore how diversification continues to define successful multi-asset investing.

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