Unorthodox investing strategies during these extraordinary times could be one way of achieving alpha, which is to outperform the benchmark index. The so-called “new normal” is anything but normal. Central bank liquidity is at an all-time high, US federal debt in the pandemic economy has spiked from 77% of GDP to 108% of GDP by this time next year. Nevertheless, despite this level of economic distress and uncertainty stocks are...
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Investing in a zero rates environment is particularly problematic for the traditional 60-40 retirement portfolio of stocks and bonds. If fact, investing in a zero rates environment has meant that the traditional retirement portfolio of stocks and bonds is down by 20% for the fourth time since WWII. The 60% stocks and 40% bonds portfolio lost value during the energy crisis recession of the 70s in 1974 and in September 2002. The...
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