Ground-hugging interest rates mean an investor hoping for an 8% return from a 60/40 mix of...

|By:, SA News Editor

Ground-hugging interest rates mean an investor hoping for an 8% return from a 60/40 mix of equities and bonds needs to compound stock gains at 12% annually. Given a cyclically adjusted earnings yield of just over 4%, such returns seem unlikely. It's time to look outside traditional stock/bond allocations or, even revisit that 8% target (are pension funds listening).