BlackRock cuts stock holdings in model portfolio cautious of excess stock market returns

On May 30, as U.S. stocks soared to record highs after a strong earnings season, BlackRock began to reduce its stock holdings in its $220 billion model portfolio business. The world's largest asset manager has cut its stock overallocation from 3% to 1%. Gates, a BlackRock executive, warned that it is becoming increasingly difficult to expect the stock market to continue to achieve excess returns. The market has absorbed positive factors and "the path to avoid potential risks in the future is narrowing."