Gina Bolvin believes the 60/40 portfolio will make a comeback in 2023. But the president of the Bolvin Wealth Management Group has some concrete tips for investors considering their strategy after a sluggish year. This strategy puts her 60% of her investment in stocks and her remaining 40% in bonds. Portfolios are down about 20% in 2022 as both the stock and bond markets have taken a hit, according to Morningstar. Now, with questions swirling about a possible recession and her investment climate in 2023, some caution against the strategy. Volvin, who has 25 years of experience in financial planning, disagrees, saying the bond market needs to be more stable. , in her words, “boring again” — as the Federal Reserve changes course in rate hikes. she said. She noted that bonds tend to perform particularly well after central banks stop raising rates. And 2023 could be the year that fixed income becomes the “typical diversifier” again, she said. “After a terrifying year, I was fascinated to see advisors saying 60/40 portfolios were dead. Double-digit declines in bonds are very rare,” she said. Told. “The 60/40 portfolio has a long-term track record, so one year is not trending.” and is even more supportive of industrials, especially aerospace and defense stocks, thanks to rising defense spending, several share buybacks, and solid dividends in the sector. Mr Volvin said business investment was “resilient” despite parts of the broader economy struggling. Volvin also highlighted the benefits that would come from “reshoring” and the impact on semiconductor stocks as companies move production out of China. The Syracuse University alum also recommended financial stocks, especially large banks and brokerages, noting that the group’s strong balance sheet after the 2008 financial crisis prepared it to withstand a recession. She also touted the attractiveness of the wealth management business, saying that a divided Capitol would make tighter financial regulation less likely. The final industry Bolvin highlighted is energy, the only group in her S&P 500 to rise last year. She said tight global supply will keep stocks buoyant and China’s reopening will bring further gains. Volvin said technology could pick up as the Federal Reserve (Fed) nears the end of its rate-hiking campaign. While he wouldn’t recommend going all-out to the sector until , he said investors should have some exposure given that it’s the largest part of the S&P. 500. Within the group, Bolvin said cybersecurity stocks could be a good play because companies “don’t take security lightly.” Not too loud. “In the bond market, frankly, I don’t think there are many wrong answers,” she said. Investors with timelines longer than three or five years should look to corporate bonds with short maturities and high-quality characteristics, Volvin said. She also said that high yield and preferred securities look healthy over the same period. Investors worried about a recession should look to one- to three-year Treasuries and corporate bonds, she said. Bolvin’s company manages approximately $380 million in assets.
