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Investing , Interest Rates , Stocks

Financial Advisors Take Heat for Market Losses (Will Anger Intensify?)

Was 2022 an aberration for the 60/40 allocation?

by Bob Stokes
Updated: April 11, 2023

Many financial advisors steer clients who are willing to take some risk toward a 60% stocks / 40% bonds portfolio.

Alas, investors who followed that strategy in 2022 saw the value of their portfolios decrease substantially.

In November, The Elliott Wave Theorist said:

Our long term bearish stance on stocks and bonds for 2022 is certainly panning out. In mid-October, [this] headline and chart, from Bank of America, made the rounds in the media:


The bond market was a big contributor to investors' losses. The September 2020 issue of EWT depicted a 78-year cycle in 10-year U.S. Treasury note yields and concluded that after 39 years of rise and 39 years of fall, interest rates had just registered a historic bottom.

Since then, as you know, interest rates have risen substantially, which means bond prices have fallen.

Even today, many clients of financial advisors are still fuming (Marketwatch, April 4):

Investors are mad as hell at advisers...

With the S&P 500 down 18% in 2022 and bonds off, too, investor sentiment toward full-service investment firms dropped significantly from last year

Yet, there are some who suggest the 60/40 allocation is still worth considering, along with perhaps a few tweaks (Forbes, March 9):

The 60/40 Portfolio Is Not Dead; It's Just Not Well-Balanced

As I write, the 60/40 strategy has performed better so far in 2023, but the remainder of the year is another matter.

If you are considering a 60% stocks / 40% bonds allocation, you may want to review Elliott Wave International's forecast for stock and bonds first.

Our Financial Forecast Service provides short-, intermediate and long-term analysis of stocks, bonds and other major U.S. financial markets.

Follow the link below to learn more.

The “Purge Phase” is Likely Underway

Here's a quote from our recently published April Elliott Wave Financial Forecast:

"The latest and what we forecast to be the greatest purge is starting..."

Learn what this purge entails and why you need to take steps now to prepare.

Suffice it to say that recent financial tremors will likely morph into a full-blown financial earthquake if our analysis is correct.

Get our analysis of U.S. stocks, bonds, gold, silver, the U.S. dollar, the U.S. economy and much more.

Follow the link below to get started.

“Lizard People” and Other Conspiracies: What’s Social Mood Got to Do with It?

In a word, everything. From political conspiracies to Covid-related ones to the theories so bizarre that they seem too silly to be relevant, we live in the golden age of conspiracy theories. And while it’s easy to blame social media for their spread, we think the roots go deeper. Watch our new Mood Riff episode where the host Greg Eident explains some fascinating socionomic findings on the subject.

Investing: What You Can Learn from Mom and Pop

Sentiment indicators provide valuable information, yet they are best used in conjunction with Elliott wave analysis. Here's one time-tested indicator that has recently displayed a "big surge."

Market Trek: "No crowd buys stocks of other countries intelligently"

When you track historical patterns of foreign investments in U.S. equities, an important picture emerges. Watch as our Market Trek host Brian Whitmer walks you through a chart of the collective foreign buying interest going back to the 1990s and through today. (Brian's global destination is South Korea.)