BlackRock’s 2014 Investment Outlook Report shows where various parts of the fixed income and equity market complex are relative to their historical valuations and it will show that government bonds, relative to where they have been historically, are quite expensive.

“We would not be urging people into government bonds,” Mr Miller said. “They do have the desirable characteristics that typically are the 'safe harbour' part of the portfolio and if there things which we haven’t forecasted that do occur, like a big risk event, then they will do well.

“We are not saying get rid of bonds altogether in a diversified portfolio context, but just bear in mind that they are quite expensive,” he said.

While SMSF trustees with a portfolio heavy in equities and property might wish to balance their portfolio out with fixed income, they may want to consider other assets, such as absolute return hedge fund structures and infrastructure debt, Mr Miller said.

“Infrastructure debt might be a good way to diversify your portfolio.

“We are very used to bond and equity returns being negatively correlated, but that’s not a relationship that has held in perpetuity and we are a little bit suspicious that, given what’s going to happen in 2014, that strong degree of negative correlation we saw a year or two ago might not persist,” he added.

“Again, that’s an argument to diversify into hedge funds, infrastructure debt, or even some high-yield type debt instruments like ETFs, which are fairly cheap and liquid.”