Actively diversified: Harnessing multiple return sources
Harnessing multiple return sources
In this paper, we reiterate that diversification by asset class should remain the foundation for growth strategies, and argue further that diversifying into active opportunities can help boost risk efficiency (although it should be noted that diversification is no guarantee against loss).
The long bull market in equities might seem to some like evidence against the benefits of diversification, but we believe now is the time for schemes to consider how diversification, and particularly the inclusion of alternative strategies, could help the efficient management of return generation, risk management and liquidity.
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Authors
John Southall
Head of Solutions Research
