Hi, the client has a view that the large-cap stocks will underperform cash. Why implemented the synthetic stock index fund by buying both risk-free bonds and S&P 500 index futures? Because as the large-cap will underperform, the S&P 500 index will go down. Am I missing sth here? Thanks
But for the first 3 months, equity performance is expected to be positive, so you only equitize the cash for the first 3 months. The equity market is expected to underperform cash after 3 months.
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