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AI Summary
- Large-cap US stocks (S&P 500) have dramatically outperformed diversified portfolios over the past 15 years, making this arguably the worst period for traditional asset allocation
- Meb Faber argues that the dominance of US tech stocks has created a 'bear market in diversification,' undermining the long-held principle that investors should hold stocks across sectors, geographies, bonds, and commodities
- The underperformance of diversified strategies raises questions about whether traditional portfolio construction advice remains valid in the current market environment