Stock market valuations are in nosebleed territory.
Last year we took steps to insulate portfolios:
- Reduced credit exposure in fixed income
- Introduced AQR Market Neutral to reduce interest rate exposure
- Increased international stocks
We are considering taking additional steps to increase our defensive positioning while sticking to client’s long term goals. Now is a good time to make sure clients are in the most suitable strategy to meet their long term goals. Also, consider rebalancing accounts which have equity allocation above target due to market drift.