100% Equities: Too Much of a Good Thing

  • Although stocks have outperformed over the long term, 100% stock portfolios experience severe declines and decade-long periods of underperformance.
  • Private assets can offer diversification and attractive returns, making them a valuable tool for aggressive investors.
  • A balanced mix of stocks, bonds, and private assets can deliver comparable returns to stocks alone, with less volatility, less significant drawdowns, and steadier growth.

When is Enough (Equity), Enough?

As we discussed in our post-election commentary, President Trump’s agenda is:

  1. Generally pro-growth, with some major exceptions like tariffs,
  2. Supportive of US equities and small cap equities versus international equities, and
  3. Likely to result in higher interest rates (a headwind for bonds) than would have been the case under a Harris administration or divided government.

Market performance post-election has largely reflected these views; US and small cap equities have outperformed and long-term interest rates have risen modestly. Many clients, quite reasonably, have asked if they should effectively lean even further into the Trump trade by allocating 80, 90, or even 100% of their portfolios to the US stock market. Our short answer is no.

While equities play an important role in portfolios, they are also prone to significant, extended drawdowns that can test the will of the most patient investors. Our most recent white paper, “100% Equities: Too Much of a Good Thing,” discusses how investors can both diversify and achieve equity-like returns over the course of a market cycle.

Download the White Paper here.

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Disclosures & Important Information

Any views expressed above represent the opinions of Mill Creek Capital Advisers ("MCCA") and are not intended as a forecast or guarantee of future results. This information is for educational purposes only. It is not intended to provide, and should not be relied upon for, particular investment advice. This publication has been prepared by MCCA. The publication is provided for information purposes only. The information contained in this publication has been obtained from sources that

MCCA believes to be reliable, but MCCA does not represent or warrant that it is accurate or complete. The views in this publication are those of MCCA and are subject to change, and MCCA has no obligation to update its opinions or the information in this publication. While MCCA has obtained information believed to be reliable, MCCA, nor any of their respective officers, partners, or employees accepts any liability whatsoever for any direct or consequential loss arising from any use of this publication or its contents.

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