Recently, Harindra de Silva, Ph.D., CFA, Portfolio Manager for the Wells Fargo Asset Management Analytic Investors team and sub-advisor to our long/short equity strategies was a guest on the podcast, On the Trading Desk® with Laurie King to talk about how a new factor, namely the stay-at-home order, has changed historical risk profiles and what it may mean for a portfolio’s risk profile.

The steady, upward trajectory of U.S. large-cap equities over the past decade has left many portfolios overexposed to the asset class. But rebalancing presents a conundrum: How can advisors decrease allocations to one of equity markets’ least-risky segments—and capitalize on more attractive valuations elsewhere—without upsetting a portfolio’s overall risk profile?