The market has entered an unusual phase. Growth is still relatively strong. Earnings remain supportive. AI investment remains powerful. The hurdle rate for almost every investment is rising. This is not yet a conventional risk-off environment. It is a repricing of what capital is worth.

AI remains one of the strongest investment cycles in the global economy. That strength is precisely why the macro consequences are becoming more important. AI is becoming a macro cycle because it is large enough to influence growth, inflation, labour, energy and the price of capital simultaneously.

When making decisions, we all look at past outcomes as one input. This paper questions the appropriateness of the common methods of measuring investment manager performance and suggests we should focus on measures that are of more relevance to actual investor outcomes.

The AI revolution may ultimately create abundance. The current investment regime is being defined by the scarcity encountered while building it. The next phase of the cycle will be determined by which assets own productive capacity and which assets can finance it.

This session first considered how practitioners can apply multi-lens analysis via AI to decide their key takeouts and next steps from Strategies Summit 2026. Then, our Practitioner Panel discussed which high conviction thesis they heard at Strategies Summit they would investigate further, why, and how.

The investment regime is becoming less about forecasting one central-bank decision and more about understanding who is competing for capital, what return they are offering and whether the resulting cost is sustainable. That changes portfolio construction.

Over the past three decades, geopolitical fragmentation, technological disruption, fiscal expansion, energy security concerns and changing market structures – and now, the infusion of AI into every aspect of society – have altered the very foundations on which portfolios have been built. In short, the macro environment that shaped portfolio construction no longer exists.

The world is always uncertain. Many events – wars, pandemics, terror attacks – have felt historic at the time but have had little lasting impact on either economies or markets. More recently, despite the US’s “Liberation Day” tariffs, globalisation is alive and well. Real oil prices remain near the long-run average despite the closure of the Straits of Hormuz causing the biggest hit to global oil supply in history. Recessions are caused by a bust in business investment but there has never been a bust without a boom – and we are not there yet. Bond yields have “normalised” after 15 years of historic lows while equity markets have mean reverted since the GFC, possibly suggesting near-term downside, but we are yet to see an end-of-cycle melt-up. Every era convinces itself it’s living through something unprecedented. Noise and cognitive bias can distort our reading of the world – but a fresh lens reveals just how resilient the global economy really is.

Volatility is no longer a temporary disruption. It is increasingly a defining feature of the investment landscape. Geopolitical fragmentation, tighter liquidity, technological change and faster capital cycles are reshaping markets, while volatility is reinforcing secular themes such as AI, electrification, energy infrastructure and national security, creating generational thematic investment opportunities. As short-term market outcomes remain uncertain, the direction of these long-term forces is becoming clearer. Investors should look beyond traditional diversification and keep their eyes on the prize – building exposure to the capital-intensive themes driving economic change, using private markets to access broader opportunity sets, enhance resilience and capture long-term returns.

By understanding the investment behaviours of stock market "maestros", practitioners can identify highly skilled fund managers and improve their own portfolio construction decisions, better equipping them to deliver the ultimate "prize" for clients - financial wellbeing.

Portfolio construction must evolve to reflect a structurally different world. Traditional diversification assumptions and portfolio frameworks which may not fully capture the risks to which portfolios are actually exposed - or take advantage of emerging asset class opportunities that the structurally different world is exposing.
How can practitioners construct multi-asset, multi-manager investment (MAMMI) portfolios which are greater than the sum of their parts and improve the financial wellbeing of individuals?

The shift from low inflation and negative stock-bond correlations is structural and has rendered conventional multi-asset diversification inadequate. Practitioners must look beyond public markets and directional risk. Non-directional digital asset derivatives takes the prize, providing resilience essential for multi-asset portfolios.

Supported by durable long-term growth trends and a history of low correlation to traditional markets, the full SME opportunity is too compelling for investors to ignore.

Powerful structural forces like AI, deglobalisation, climate change, and ageing demographics are reshaping the world as we know it. These forces impact investments across asset classes, regions, and sectors, challenging traditional portfolio construction processes. Furthermore, capital market assumptions, that typically rely on the continuation of recognised relationships and reversion from extreme conditions back to more reasonable ‘norms’ can struggle with structural trends that, by their very nature, deliver new norms, and divergent outcomes. Capturing the opportunities resulting from structural trends, and managing the risks emerging from them can only be achieved through TPA.

A static fixed income allocation was built for a world that no longer exists. The price-insensitive central-bank buyer that suppressed volatility and kept bonds negatively correlated to equities has disappeared at a time when inflation and fiscal sustainability risks are at the forefront of investors’ minds. This new regime demands an unconstrained, absolute-return approach – absolute return fixed income is the diversification prize. However, absolute return strategies can differ substantially in flexibility and exposures. A factor-based framework can help investors understand which characteristics to look for when assessing these strategies.

Markets have narrowed sharply around a single theme: AI hardware bottlenecks, amplified by the launch of AI agents and scaled-up capex plans. Concentration and single-theme exuberance typically precede a durable broadening, with value dispersion narrowing and the style outperforming even as industry outcomes widen through disruption. Markets are at a turning point where the valuation extremes are set to unwind, and the next cycle’s winners will look very different from previous decades. Allocators seeking diversification and protection should rebalance toward fundamental value in global equity portfolios.

Today, more than 90% of global investable assets exhibit a meaningful correlation with the S&P 500, compared with just 26% in 1995. Where the S&P 500 goes, increasingly, so does the rest of the portfolio. The portfolio construction challenge is no longer simply owning different assets. Many of the traditional sources of diversification – including bonds, private markets and hedge funds – have become increasingly caught up in the same market forces. This makes alternative risk premia crucial. Unlike traditional market beta, they arise from structural and behavioural inefficiencies, providing a differentiated source of return that can improve portfolio resilience, increase returns per unit of risk - and keep investors’ eyes on the prize.

It’s more important than ever today to “cut through the noise” when constructing portfolios. Traditional strategic allocation frameworks may be too static for a macro backdrop that continues to evolve – but portfolios also should not be repositioned simply in response to every headline. Keeping your eyes on the prize requires disciplined integration by using macro data within a quantitative, repeatable process to guide portfolio decisions. Connecting macro signals to portfolio construction across public and private markets helps allocators manage changing risks and opportunities and build portfolios with greater confidence and consistency.

Every active portfolio holds two bets: selection, which is measured, and sizing, which is merely asserted. Decades of evidence show naive equal weighting is remarkably hard to beat.

With some sectors of the private credit market facing rising redemptions, liquidity scrutiny and weakening confidence, concentrating portfolios in a narrow, illiquid slice of the market is hard to justify – especially when private credit is only ~10% of Australia’s ~$2.2 trillion credit universe. The challenge is no longer accessing income, but generating it without sacrificing diversification, liquidity or flexibility, and higher income need not mean a shift into illiquid strategies. A multi-sector approach offers a credit opportunity set ~10x larger than private credit, daily liquidity instead of quarterly gates, and diversified relative value across every sector – capturing similar yield without concentrating risk in one illiquid slice.