Multi-asset portfolio allocation

Barclays Private Bank discusses asset allocation views within the context of a multi-asset class portfolio. Our views elsewhere in the publication are absolute and within the context of each asset class.

Cash and short duration bonds

• Recent additions to shorter-dated bonds reflect less perceived risk-reward in equity markets and the continued inversion of the yield curve.

Fixed income

• Value is seen in developed market government bonds, which can also hedge against macroeconomic volatility.
• In credit, the higher-quality segment is preferred, driven by what is considered to be better relative value.
• Exposure is relatively low in high yield, where selection is key, as spreads have room to widen in an adverse scenario.

Equities

• In line with our long-term investment philosophy, portfolios remain geared towards high-quality, cash-generative and conservatively capitalised businesses.
• As a function of bottom-up selection, more opportunities are found in developed market equities compared to those in emerging markets. 

Alternative trading strategies (ATS)

• There are a limited number of opportunities in the ATS universe, as the cost/benefit trade-off can be challenging.
• Our focus is on strategies that offer low correlations to equity markets, so providing diversification benefits.

Commodities

• As a risk-mitigating asset, gold remains the only direct commodity exposure held in portfolios.
• Elsewhere, we believe that our risk budget is better spent outside of the asset class.

Disclaimer

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(I) is not research nor a product of the Barclays Research department. Any views expressed in these materials may differ from those of the Barclays Research department. All opinions and estimates are given as of the date of the materials and are subject to change. Barclays is not obliged to inform recipients of these materials of any change to such opinions or estimates;

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