In his recent appearance on ‘The Claman Countdown,’ BlackRock chairman and CEO Larry Fink shared insights on tariff negotiations with China and market volatility. He also touched upon the evolution of the 60/40 portfolio strategy, a traditional method of balancing stocks and bonds for retirement savings.
Fink wrote in his 2025 Letter to Investors that while many investors have benefited from the 60/40 approach, the global financial landscape is shifting. He suggested the traditional model may not capture true diversification anymore. Instead, he proposed a 50/30/20 portfolio, integrating stocks, bonds, and private assets such as real estate, infrastructure, and private credit.
In terms of infrastructure investment, Fink highlighted its advantages, including inflation protection and stable returns. He pointed out that allocating even 10% of a portfolio to infrastructure could yield positive results. As an example, BlackRock recently invested $23 billion in the Panama Canal ports, demonstrating potential revenue generation from vessel fees.
Despite BlackRock’s standing as the world’s largest asset manager, with over $11 trillion in assets, Fink indicated that the 50/30/20 mix could also benefit retail investors. Katie Klingensmith, Chief Investment Strategist at Edelman Financial Engines, echoed this sentiment. She remarked that for investors with long-term horizons, including private assets can enhance diversification.
Klingensmith also emphasized the potential of private markets amidst current public market fluctuations, suggesting it would be interesting to observe their performance during this period. The S&P 500, a key U.S. stock market index, has decreased by 10% this year, while Morningstar’s US Core Bond Index has increased approximately 2%, reflecting investment-grade securities with maturities exceeding one year.
