2025 Asset Allocation In 'Higher-For-Longer' Era: Why Value Stocks, Emerging Markets, Inflation-Protected Bonds Stand Out

1. Portfolio strategist advocates reallocating assets over the next 3-5 years. He emphasizes caution amid higher-for-longer rates. 2. Domestic growth stocks face reduced exposure as equity risk premiums fall. Large- and mid-cap stocks may be particularly affected. 3. Value equities and emerging markets gain favor for long-term risk-reward advantages. ETFs like VTV and EEM are suggested for exposure. 4. Fixed income approach shifts from long-duration Treasuries to short-duration TIPS and core bonds. This hints at caution in traditional fixed income. 5. Alternatives and real assets are recommended to hedge inflation and volatility. Diversified funds and commodity ETFs are highlighted.