How Does Your 60/40 Portfolio Allocation Compare With the Pros?

Before you take off for the summer, it’s a good time to check in on your 60/40 portfolio. Besides regular rebalancing, it’s worthwhile to make sure the strategic asset allocation still fits with your risk tolerance and time horizon, too.

Strategic asset allocation is the anchor of your portfolio. It’s how you spread your investments across different asset classes and regions to match your goals and risk tolerance. Instead of just choosing between broad categories like stocks, bonds, and cash, it also includes more detailed decisions, like how much to invest in US stocks versus international stocks, or in large companies versus small ones. That blueprint is the target used for rebalancing when market moves may throw the allocation off course.

For many investors, handing off those decisions to a target-date or balanced fund that’s well-managed and has low costs is the best option, but some investors want more control over these decisions. That means thinking through questions like:

How much should I own in international stocks?

Do bonds still work as a diversifier?

Even the famed oracles that live on secluded mountaintops would have trouble finding the right answers, but there’s another option: Peek at what’s being done by professional money managers.

Using the Collective Wisdom of Model Portfolio Managers

Model portfolios are a popular tool for financial advisors looking for guidance on how to build and manage portfolios. Almost $650 billion follows third-party model portfolios as of March 2025, according to the 2025 Morningstar US Model Portfolio Landscape.

Managers typically build model portfolios using funds or exchange-traded funds offered by their own firm. If the managers are good, they can raise a considerable amount of assets for the underlying funds. But these portfolios also give managers a chance to show how they think about building robust, well-diversified portfolios. It’s a practical way to see how big-picture ideas, like capital market assumptions, play out in the real world.

By aggregating the strategic asset allocations of some of the most highly regarded model portfolios, we can get a sense of how experts are building strategic asset allocations for 60/40 portfolios today.

We focused on model portfolios that have low trading activity (meaning they aren’t making too many short-term bets) and carry Morningstar Medalist Ratings or Gold, Silver, or Bronze, or are closely related to models that do. For example, we included the BlackRock 60/40 Long-Horizon Allocation ETF model, which is a low-turnover version of BlackRock’s more tactical flagship 60/40 Target Allocation ETF model. Morningstar analysts assign the latter a Morningstar Medalist Rating of Gold, but they don’t rate the former.

The exhibit below shows the average allocation to major asset classes of 10 of the top model portfolio managers at the end of March 2025. Since these portfolios are focused on long-term views, we don’t expect the allocations to change much quarterly, but we would expect annual updates.

The Consensus View on Stocks

To identify where the consensus portfolio has active views, we can compare their allocations with a simple market-cap-weighted 60/40 portfolio, constructed using the Morningstar Global Markets Index and the Morningstar US Core Bond Index. (Note: Because of the extreme home bias in bonds, comparisons to the global bond market aren’t particularly relevant.)

The table below shows the consensus portfolio’s allocation to equities overall and the geographic breakdown. The big takeaway? Top managers remain bullish on US stocks.

The consensus portfolio shows a modest 1-percentage-point overweighting to stocks, signaling cautious long-term optimism. Within the stock portfolio, US stocks remain favored with a 4-percentage-point overweighting, while emerging-market stocks have a small 2-percentage-point underweighting.

The US stock market has underperformed international peers for the year to date as the ongoing trade war weighs on investor sentiment and the US dollar. Emerging markets have been a bright spot, driven in part by an artificial intelligence breakthrough earlier this year, but there could be reason for caution. My colleague Amy Arnott explores the pros and cons of investing in China, the largest emerging market, here.

The Consensus View on Bonds

Despite ongoing concerns that bonds may no longer serve as effective diversifiers, the consensus portfolio maintains a substantial allocation to investment-grade US bonds. The largest difference versus the market-cap-weighted portfolio is a 6-percentage-point position in high-yield bonds. These bonds tend to be less sensitive to interest rate movements because of their higher starting yields, which could make them more attractive from a total return perspective if interest rates continue to rise.

How to Use This to Check Your Own Portfolio

The consensus portfolio isn’t meant to be a prescriptive asset allocation, but it can serve as a helpful reference point. If you’re considering adjustments, such as reducing home bias in your stock portfolio or lowering interest rate sensitivity in your bond holdings, the consensus view offers insight into how others are positioning their portfolios for the future.

Appendix

The following exhibits show a more granular breakdown of the consensus portfolio, along with the model portfolios used to construct it.