Ruminating on Asset Allocation

Oaktree

Howard Marks

Research

9 Pages

Howard Marks outlines a foundational approach to asset allocation, emphasizing the core choice between ownership and lending, and how investors should consciously balance offense and defense based on their personal risk appetite and market conditions.

Key Takeaways

Ownership vs. lending: Asset allocation starts with deciding between growth-oriented ownership assets and income-based credit instruments
Risk posture leads: Optimal portfolios reflect a deliberate balance between risk-taking and capital preservation, not just return maximization
Credit regains appeal: With yields near 7–10%, credit offers a more dependable return stream, making it a relevant choice for many investors today
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