J.P. Morgan’s long-term capital assumptions raise 60/40 return forecast to 7.0%

A USD 15 trillion capital spending surge underpins J.P. Morgan Asset Management’s 2027 long-term capital assumptions, which project stronger growth and higher portfolio returns over the next 10 to 15 years. The firm raises its annual return forecast for a USD 60/40 stock-bond portfolio to 7.0% , while arguing that higher stock-bond correlations strengthen the case for diversification. Key takeaways J.P. Morgan projects a 50% increase in total factor productivity by 2040. U.S. large-cap equities have a 7.5% return forecast, versus 7.1% for emerging markets. A 30% alternatives allocation lifts projected portfolio returns to 7.5%.

Source: The Cryptonomist