Retirees and other income-seeking investors will need to adopt a broader investment approach to ensure a consistent income stream, according to Goldman Sachs Asset Management’s Angus Bell.
As investors move funds out of cash, they will require a diversified set of income-generating assets to avoid being bound by the ebb and flow of one asset, he said.
“If you’re an investor and you’ve got a heavy concentration to one particular income-producing asset, then really you have to accept the ebb and flow of how that asset class will typically perform over the business cycle,” he said.
“We’re in a part of the business cycle where particularly retirees and people looking for income will need to think about a broader approach to trying to source that income.”
Bell said a multi-asset approach derived value from the offsets it produced and harked back to the old story of diversification.
“When you’re taking a broad opportunity set across a different range of income-producing assets, you get this natural diversification effect and it’s allowing for the different offsets,” he said.
