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For more than two decades, Mr. Bernstein has tracked recommended equity allocations in balanced portfolios managed by Wall Street firms.
While Lehman Brothers and Commerz International have increased their overall equity allocations, Daiwa has increased its bond allocation.
According to Morningstar's analysis of 2010 funds, equity allocations as of late last year varied from 26 percent to 65 percent.
And while investors in 401(k) retirement plans have signaled skittishness by reducing their equity allocations, their risk aversion isn't close to where it was when the market bottomed in March 2009.
But McKinsey estimates they would have to raise their equity allocations to the 42% owned by American households to close the gap completely.Developing-world investors have understandable reasons for caution.
You'll want to use equity allocations to incentivize your founders to stick it out and grow the business.
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They found US companies, which are usually better funded, can pay much higher salaries and are more predictable in how equity is allocated, although equity allocation is only very slightly higher.
But after the market sell-off, that equity allocation dipped to around 38percentt.
Suppose about half the typical existing equity allocation is treated this way.
Credit Suisse and Lehman have considerably reduced their holdings of equities; only Commerzbank greatly raised its equity allocation.
In 2006, a 60-year-old in the age-appropriate Fidelity Freedom fund had a 53 percent equity allocation.
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