I read El-Erian's Book When Markets Collide when it first came out. I implemented some of his suggestions in my portfolio. For the most part, I don't like EL-Erian's ideas. Some of El-Erian's recommendations are very macro (what he calls secular) - and I am not a macro guy.
I like El-Erian's suggestions EXCEPT for his use of private equity, macro bets and special opportunties. I can only assume that "special opportunties" means hedge fund strategies. El-Erian does a lousy job of explaining his asset classes. For example: is Real Estate domestic or foreign or both? Is Inflation protected bonds domestic or foreign or both? What is Special Opportunties?
El-Erian recommendeds that individuals allocate their assets using only index funds and keep the asset allocation fixed from year to year.
El-Erian Asset Allocation Model
15% in U.S. stock index funds
15% in foreign, developed stocks
12% emerging market stocks
08% in Special Opportunties
05% in Infrastructure
07% Private Equity stocks
05% in U.S. Treasury bonds
09% in Foreign bonds
05% in (U.S.?) Treasury Inflation Protected Securities
06% in real estate index funds
11% in commodities
Totals only to 98%