Best wealth management risk committees are targeting volatility bands to manage drawdowns, particularly in high-beta growth stocks showing earnings uncertainty. A major change Lynch lamented, though, was that, a decade and a half ago, there were 8,000 publicly traded companies. “Now there’s three or four [thousand].” A 60/40 mix doesn’t have to be monolithic—many different types of stocks and bonds are available. If you want to stay 60/40 but get a bit more protection for your equities bucket, you could direct some funds into defensive stock sectors like consumer staples or utilities, which can be less volatile than large-caps. These sectors also typically offer appetizing dividends , which you could consider keeping instead of reinvesting as your income needs grow in retirement, or if you dial back on work. Best wealth management strategies are adapting to 2024's volatile equity markets, with S&P 500 earnings growth projected at 9% this quarter. Institutional inflows into tech and healthcare sectors suggest a rotation toward defensive growth plays.
