Portfolio Construction in a Fracturing World

Four decades of globalization gave portfolios a predictable playbook: 60/40 allocations, steady disinflation, and synchronized global growth. This issue looks at what replaces it, from CLO equity and private infrastructure to crypto, prediction markets, and jurisdictional diversification for globally exposed clients.

Inside This Issue:

• The Fracturing of the Global Economy: Implications for Asset Allocation in a Multipolar World — Maria Katsileros, CIMC®, CSRIC®, maps five portfolio changes advisors should make as trade, demographics, and monetary policy diverge by region instead of moving together.
  
• Total Portfolio Approach and Its Applications for Wealth Management — Aaron Filbeck, CAIA®, CFA®, CFP®, CIPM, FDP, translates the total portfolio approach used by sovereign wealth funds and pensions into a model wealth managers can apply to individual client accounts.
  
• The Post-Growth Perspective: A Client-Aware Framework for Resilient Portfolio Construction — Noel Pacarro Brown, CIMA®, CPWA®, builds a five-layer portfolio framework for advisors whose clients are questioning growth-only investing assumptions.
  
• Stagflation-Light: Iran, Energy Markets, and the Risk of Re-Accelerating Inflation and Slower Growth — Collin Crownover, PhD, FRM, and Jacob Weinstein, CFA®, argue inflation is more likely to re-accelerate than markets expect, driven by Iran-related energy risk and historical patterns of secondary inflation waves.
  
• Private Infrastructure: A Strategic Allocation in a Changing Investment Landscape — Derek Craig, CAIA®, breaks down the digitalization, decarbonization, and deconsolidation trends driving private infrastructure from a niche allocation to a foundational one.
  
• CLO Equity: An Emerging Alternative — Elliot Hill, CFA®, explains how CLO equity's structural arbitrage generates mid-teens cash yields and where it fits between private credit and private equity.
  
• Beyond Borders: Jurisdictional Diversification as a Core Wealth Management Strategy — Andrejs Pilajevs, CFP®, MSFP, walks through how advisors help U.S. clients evaluate residency, custody, and legal-structure diversification without requiring anyone to leave the country.
  
• Crypto in the Portfolio: Advisory Guidance for Digital Asset Allocations — Keith Black, PhD, CFA®, CAIA®, CFP®, FDP, CDAA, lays out how regulatory clarity from spot bitcoin ETFs and the GENIUS Act is changing how advisors size digital-asset allocations.
  
• Predictably Unprofitable: Why Prediction Markets Are Not Investing — Charles Martineau, PhD, Vincent Grégoire, PhD, CFA®, and Nicolas Harvie discuss why prediction-market profits concentrate among market makers, not the retail traders drawn in by Polymarket and Kalshi.
  
• The Impact of Market and Spending Shocks on Retiree Portfolios — Christine Benz and Amy Arnott, CFA®, quantify how sequence-of-returns risk and inflation spikes early in retirement can cut a safe withdrawal rate by half a percentage point or more.
  
• Behavior Beats Education: Knowing Your Limits on Semi-Liquidity — William (Bill) Kelly, CAIA®, and Scott Welch, CIMA®, CEPA®, discuss why recent gating at semi-liquid funds is a structural mismatch between retail expectations and product design, not a sign the asset class failed.
  
• More Than Performance: How Advisors' Approach to Portfolio Management Impacts Growth — George Walper, Jr., and John Bowen, Jr., share CEG Insights research showing 28.7 percent of clients would leave an advisor who fully outsources investment management without saying so.