While no one can anticipate the next generation of truly diversifying assets, he says there are some global themes that should shape the construction of portfolios. “You’re going to get better risk/ return characteristics out of incomeseeking and carry-type strategies than you are out of purely directional strategies,” he says. “We’re back to a phase where a larger proportion of the return is going to come from the underlying income stream, so you have to think about: ‘have I diversified not just the asset class but my source of income within the portfolio as well?’.”

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