Behind the Numbers, with Mark Balasa
Although risk remains, Balasa says that he and his colleagues in the Alpha Group have "a growing optimism around some of the opportunities in some parts of the market." On the fixed income side, while inflation remains a concern, high-yield bonds and some and other instruments have had some great recent returns. "That's a theme that we're paying close attention to--whether we should venture farther out on the yield curve and put some more corporate bonds in the mix, instead of just government bonds and agencies." As far as stocks, Balasa still favors overweighting growth stocks because they're undervalued relative to value stocks. "The real conundrum is, what do you do with the domestic vs. international allocation? Emerging markets is a great story. India, maybe China, is a great story, but you can't put a third of the portfolio there, so you come back to this inevitable position of how much is too much?"
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