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Diversification is an easy concept to adopt but a hard concept to maintain, particularly when there are extreme periods of concentrated market leadership. While US large caps have outperformed non-US equities over the past decade, the outlook and rewards are different when taking the long-term goals approach with non-US equities.

2022 should be viewed as a transition year as the global economic and investment environment evolves in search of a new reality. Inflation and central banks will be in focus, along with other shifts underway. For investors, all the change means having an effective risk management of portfolios that is complemented by longer-term considerations. Two essential components of it will be your strategic asset allocation and the ESG factor.

Last year was another challenging and disruptive year for public health and global trade. Despite pandemic-driven dislocations, supportive government policies propelled most economies and “risk assets” higher. With the potential for recent tailwinds to become headwinds, how should investment portfolios be positioned going forward?

As investing has grown increasingly personalized, separately managed accounts (SMA) have become a trusted vehicle for customized solutions to meet a client’s unique objectives. Up to now, when looking for personalized fixed-income solutions, advisors have considered key factors such as income needs, liquidity requirements, investment horizon, credit tolerances, and personal values. However, it’s not about what you earn; it’s about what you keep.

Chinese equities have lagged both emerging market and global equity indices year to date. Recent regulations directed toward education and technology companies have caused Chinese equities to come under pressure. As further regulatory actions appear likely, should investors continue to allocate to Chinese equities?

Near-term inflation concerns have raised investor interest in real assets. While core real estate offers a steady foundation for a diversified real assets portfolio, infrastructure can serve as a high-quality complement that can help protect against inflation and benefit total return.

This year has made it abundantly clear that investing in China carries risk. How will recent regulatory shifts in China affect investment strategy? A diversified approach is the key to spread out exposure.

With the frequency and damage of weather-related events continuing to rise, now is the time for municipal bond investors to assess and mitigate the climate risk. Along with other measures to take, the risk assessment should include whether the municipality has enacted any resiliency plans to combat risks from weather-related events.

There is a growing awareness that investment-grade corporate bond investors can use the same environmental, social, and governance (ESG) metrics popular in equity portfolios. Though in its early stages, this awareness is leading to rapid growth in socially responsible bond investing. By incorporating ESG, bond investors may achieve superior risk mitigation and without sacrificing yield or portfolio returns.

Municipal bonds had a turbulent third quarter. But did the sharp rise in yields (and corresponding drop in prices) cause investors to overreact?