Risk-parity strategies, long associated with Bridgewater Associates founder Ray Dalio and often viewed as lagging, are seeing a notable rebound in 2025, with multi-asset funds following the approach returning 12–15%, according to a report by Bloomberg.
ETFs such as UPAR Ultra Risk Parity meanwhile, have gained as much as 19% so far this year.
The revival has been driven largely by fixed income, with bond price gains amplified through leverage, alongside diversification across equities, inflation-linked bonds, and gold. After years of underperformance—particularly during the 2022 sell-off when stocks and bonds fell together—the strategy is delivering both protection and returns in a turbulent US market.
ETFs tracking risk parity now outperform both the S&P 500 and traditional 60/40 balanced portfolios, although total assets remain well below previous peaks.
Funds such as AQR Capital Management’s Multi-Asset Fund have received significant inflows this year, reflecting renewed investor interest.
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