Is it better to continue buying assets that look increasingly expensive (providing little or no value)? Or to leave something on the table as prices keep going up and risk missing out on further gains? In short, as markets continue to rise, the risk allocation dilemma has become an even harder problem for investors to solve.

The second half of 2017 was a very good year for equity and credit markets. It marks the tenth year of the current bull market, with phrases like “grab for yield” and “low volatility for longer” being chanted more frequently by investors. In this environment, what is the prudent thing to do for investors seeking a consistent long-term real return?

Is it better to continue buying assets that look increasingly expensive (providing little or no value)? Or to leave something on the table as prices keep going up and risk missing out on further gains? In short, as markets continue to rise, the risk allocation dilemma has become an even harder problem for investors to solve.

Here our Multi Asset Solutions team discuss how we approach the asset allocation conundrum in a world where valuations look increasingly stretched – and the ever more important need to be flexible and dynamic to achieve a real return.

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