Bridgewater examines how investors can diversify beyond increasingly concentrated US equity exposure without simply becoming more defensive. With household financial investments in equities near 80%, it highlights foreign stocks, government bonds, and gold as potentially complementary assets offering different sources of return and resilience.
A Wealth of Opportunity
Bridgewater
Article
1 Pages
Key Takeaways
Equity Exposure Concentration: US households now hold roughly 80% of financial investments in equities, versus about 50% coming out of the financial crisis.US households now hold roughly 80% of financial investments in equities, versus about 50% coming out of the financial crisis.
Bonds Regain Relevance: Bonds once represented 40% of a traditional 60/40 portfolio before near zero yields during the 2010s reduced their appeal.
Foreign Equity Opportunity: Outside the Magnificent 7, the S&P 493 has delivered similar earnings growth to foreign companies despite trading at a substantial valuation premium.
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