I asked the same question last year. 57% 80/20; 17% 70/30; and 27% 60/40 were the answers.
Hostilities with Iran starting Feb 28, 2026, kicked off spikes of volatility, suggesting now might be a good time to remind ourselves of the importance of diversification,
and to maintain a long-term perspective. “This time is different” always entails potential dangers, notwithstanding there always being an element of truth to it.
A traditionally negative correlation between stocks and bonds is presently challenged by an ongoing inflationary setup, runaway deficits, and unsustainable debt levels. Shifting interest-rate expectations reflect these factors – as slowing growth and weakening labor markets otherwise argue lower rates.
Equity‑heavy allocations (see 80/20) may feel comfortable during strong markets, but periods of rising uncertainty underscore the importance of a disciplined allocation across asset classes. This does not eliminate drawdowns but serves to keep investors invested through an unsettling market as portfolio risk is better managed.
Tempting though it may be, reacting to short‑term headlines needs to heed to a history consistently reminding us to stay invested through periods of uncertainty as opposed to attempting to time exits and re‑entries.
Through constantly evolving markets the core principle remains – diversification is meant for moments like these. A well‑constructed allocation – balanced or more growth‑oriented – works best when consistently adhered to – through turbulent and calmer markets.
