Is the 60/40 balanced portfolio dead? Not quite

AMID a year of dismal asset returns, spiking correlations and volatility, several pundits have sounded warnings against the traditional 60/40 (stock/bond) portfolio that has been a mainstay of retirement investing.

But calling the death of a balanced 60/40 allocation may well be premature. Stocks and bonds, which this year suffered their worst year in decades, now offer attractive entry points and yields. This bodes well for long-term returns.

Sticking to a regular investment, however, still calls for courage. Year-to-date returns from both asset classes remain in the red, and uncertainty on various fronts hangs heavily. Double-digit losses on a 60/40 portfolio are the worst since the 1930s.