Bank of America (BAC) analyst Michael Hartnett said that a simple, balanced investment strategy is having one of its best years in modern market history. The approach, often called the “sleep like a baby” portfolio, spreads money evenly across stocks, bonds, commodities, and cash. Because of this diversification, the strategy has been performing strongly in 2026. In fact, it is currently on pace for a 26% annual return, which is close to one of the highest levels ever recorded.
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New trading tool for SPY bullsAt the same time, this performance stands out even more when compared to traditional portfolios. The balanced 25/25/25/25 strategy is now delivering its third-best outperformance versus the classic 60/40 stock-and-bond portfolio over the past century. As a result, it is showing how diversification across more asset classes can provide an edge, especially during periods of market volatility. This also highlights a change in how different types of assets are contributing to returns.
Interestingly, commodities have been the main driver behind this strong performance. Even so, many investors still have very little exposure to them. According to Bank of America, private clients hold just 0.4% of their portfolios in gold, even though it has been rising at a 31% annualized rate. Because of this gap, commodities may still have room to play a larger role in portfolios going forward.
Is SPY Stock a Good Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on the SPDR S&P 500 ETF Trust (SPY) stock based on 409 Buys, 86 Holds, and eight Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average SPY price target of $835.51 per share implies 17.1% upside potential.
