Franklin Templeton Institute Research Hub

The Franklin Templeton Institute advocates for a strategic shift toward private market allocations, suggesting that investors can capture an illiquidity premium by dedicating 10-20% of portfolios to private equity, credit, and real estate via accessible evergreen fund structures. This democratization of private assets is presented as a method to outperform traditional 60/40 models and better manage volatility, citing historical success from 2012–2025. On the macroeconomic front, the Institute maintains a constructive outlook supported by resilient labor markets, persistent AI infrastructure spending, and robust 15% Y/Y earnings growth. However, researchers caution against heavy concentration in US mega-caps, instead favoring a broadening strategy that targets US small-caps, emerging markets, and Japan. While geopolitical tensions in the Middle East and Brent crude prices at $95 pose risks to inflation, the firm suggests tactical fixed income positioning, including adding duration as yields cross 4.50%. Ultimately, the research highlights a transition from chasing narrow rallies toward a diversified, goals-based approach that balances structured liquidity with high-conviction global equity exposure.