Podcast Summary: How I Invest with David Weisburd

Episode E262: The 50-30-20 Portfolio: How Institutions Are Rebuilding 60/40

Date: December 15, 2025
Guest: Alfred (Deputy CIO, Q Wealth Partners)
Host: David Weisburd

Overview

In this episode, David Weisburd sits down with Alfred, Deputy Chief Investment Officer at Q Wealth Partners, to discuss the evolution of the classic 60/40 investment portfolio. They explore how institutional investors are reimagining asset allocation with a heavier focus on alternatives, behavioral finance, and real assets. The conversation covers portfolio construction frameworks, the value of illiquidity, diversification beyond conventional measures, and best practices for navigating liquidity crises.

Key Discussion Points & Insights

1. Alfred’s Background and Firm-building Philosophy

• Alfred recounts diverse experience: ETF strategist at BMO, fixed income head at a $30bn fund, and Bank of Canada during quantitative easing ([00:00]).
• Emphasizes importance of well-rounded experience—understanding both portfolio management and the mechanics of asset management businesses ([00:20]).
• Key takeaway: Building products means integrating legal, operations, marketing, and value proposition.

“One of the key aspects is that I learned how to take an idea and basically create a product out of it, work with legal and operations… also coming up with the value proposition, the sales and marketing, going on the road and marketing and growing the assets.”
— Alfred ([01:30])

2. Q Wealth Partners: The Turnkey Platform for Independent Advisors

• Q Wealth is likened to Hightower or Focus Financial, offering turnkey solutions for advisors wanting independence—legal, compliance, technology, and investment platforms ([03:30]).
• Aims to make it easy for advisors to go independent in the Canadian regulatory environment.

3. Portfolio Construction in an Evolving Market

• Open architecture lets individual advisors build portfolios within regulatory guardrails.
• Offers access to institutional pricing for external funds, custom asset allocation models for diverse objectives, guidance on tax efficiency ([04:59]).

4. Alternatives, Alpha, and the “Debasement Regime”

• Alfred is bullish on alternatives:
  • Private equity and private credit offer higher potential for alpha due to information asymmetry.
  • Public markets are highly efficient; alpha is harder to come by due to rapid information flow and sophisticated participants ([06:17]).
• Correlation between equities and bonds is increasing due to macro shifts and policy responses to inflation and government debt ([07:42]).

“Generating alpha is much more difficult… the information is more asymmetric on [the private] side... fixed income and equities are going to become increasingly correlated in this environment.”
— Alfred ([07:05])

5. Inflation, Real Assets, and Portfolio Exposure to Crypto & Gold

• CPI often underrepresents "real life" cost increases ([09:23]).
• Sees real assets like gold and bitcoin as partial inflation hedges; Q Wealth prefers to let advisors tailor their own exposures, but is working on "one ticket" real asset solutions ([11:00]).

“We’re thinking about launching... targeted one ticket solutions... based on that kind of debasement regime and inflation regime that provides almost like a bolt on to a traditional 60/40 portfolio.”
— Alfred ([12:55])

6. Behavioral Finance: The Virtue of Diversification and Illiquidity

• Host notes behavioral errors—like failing to get any exposure being worse than picking the “wrong” crypto ([11:55]).
• Alfred prefers diversified baskets for risky or unfamiliar assets, specifically within crypto ([12:55]).
• Illiquidity (from privates) is framed as a behavioral advantage: prevents panic selling, “the virtue of illiquidity” ([21:02]).

“When you look at investing, staying invested is the right course of action... privates in a portfolio... removes some of the behavioral elements to that needing to sell and stop those losses.”
— Alfred ([20:30])

7. Revising the 60/40 Portfolio: Enter the 50-30-20

• New model: 50% equities, 30% bonds, 20% alternatives. Adjusted to client risk tolerance ([14:45]).
• The “instant upgrade” for many new clients is tucking alternatives into their portfolios—private equity, private credit, multi-strat, discretionary macro, and CTAs for negative/uncorrelated returns ([14:45]).

8. Correlation, Diversification, and Portfolio “Modules”

• Fixed income is not always a safe ballast if moving into riskier, highly correlated securities (junk bonds).
• “Credit is equity on training wheels”—high yield bonds correlate with equities ([17:32]).
• Alfred structures portfolios in three major buckets: Equities, Fixed Income, and Alternatives—with alternatives subdivided into assets (e.g., infrastructure, privates) and strategies (e.g., long/short, CTAs).

9. Access, Democratization, and New Alternative Asset Classes

• Democratizes access to private funds otherwise inaccessible for smaller clients by pooling and staggering private fund investments ([24:42]).
• Brings up “J curve smoothing” by allocating to funds at various stages of investment.
• Due diligence and institutional rigor are non-negotiable for any new asset class—be it sports teams or whiskey barrels ([28:57], [30:35]).

10. True Diversification and the Limits of Heuristics

• Hosts discuss first-principles thinking about true diversification—geographic or sector heuristics may mask real correlations ([34:03]).
• Must gamify/war-game liquidity crises and plan portfolio “liquidity pockets” in advance ([41:23]).

Notable Quotes & Memorable Moments

• On 2020 and 2008, liquidity lessons:

  “The major kind of learning lesson during those time periods was that don’t take liquidity for granted... you don’t take liquidity for granted. So when we construct portfolios, knowing where to draw liquidity from… was the major learning lesson.”
  — Alfred ([39:53])

• On behavioral finance:

  “If you need to draw liquidity from your portfolio and you don’t have it, chances are your portfolio wasn’t structured correctly in the first place.”
  — Alfred ([42:38])

• On interval funds:

  “Interval funds... bridge the gap... if we draw down our liquidity sleeve, we could kind of tap into interval funds where we could have monthly or quarterly liquidity.”
  — Alfred ([28:00])

• On diversification:

  “How much more diversification are you going to get from a 50 stock portfolio to maybe 150... If you're adding additional assets—different kind of exposures... that's diversification.”
  — Alfred ([31:13])

• On “debasement regime”:

  “We are in this debasement regime where you look at government debt, especially the U.S.… the only way out is to debase their currency.”
  — Alfred ([09:23])

Key Timestamps & Segment Highlights

| Timestamp | Topic | |---------------|-------------------------------------------------------------------| | 00:00 | Alfred's career trajectory and experience in asset management | | 03:30 | What Q Wealth Partners provides for independent advisors | | 06:17 | Challenges of generating alpha and rise of alternatives | | 09:23 | Inflation, real assets, and the CPI disconnect | | 11:00 | Q Wealth's approach to crypto and gold in client portfolios | | 12:55 | Baskets vs. picking individual assets; behavioral decisions | | 14:45 | The 50-30-20 portfolio—modern alternative to 60/40 | | 17:32 | Fixed income, correlation risks, and “credit is equity on training wheels” | | 20:30 | The behavioral impacts of illiquid investments | | 24:42 | Democratizing private asset access; the J-curve | | 28:00 | Use and design of interval funds in portfolio liquidity | | 31:13 | Diversification: adding return streams vs. more of same assets | | 34:03 | First-principles diversification and portfolio heuristics | | 39:53 | Lessons from crises: "don’t take liquidity for granted" | | 41:34 | Liquidity management during crises; war-game preparedness | | 43:33 | Behavioral exercises—planning for max drawdown |

Final Thoughts

Actionable Takeaways:

• The old 60/40 standard is evolving—expect heavier allocations (e.g., 50/30/20) to alternatives, including both private assets and alternative strategies.
• True diversification means reducing correlations not just by the type of asset, but by understanding deeper drivers—liquidity, regime shifts, and crisis correlations.
• Behavioral finance isn’t just theory—using illiquidity and behavioral “guardrails” can improve long-term outcomes for institutions and individuals.
• Always plan portfolio liquidity in advance, and simulate crisis scenarios to pressure-test asset mix and withdrawal strategies.

Closing Quote:

“If you don’t need liquidity, don’t tap into it. If you need to draw liquidity from your portfolio and you don’t have it, chances are your portfolio wasn’t structured correctly in the first place.”
— Alfred ([42:38])