When looking to reconnect risk and return in portfolios, what better place to start than with the barometer of equity market risk itself?

The size of the global infrastructure asset universe will expand from $40 trillion earlier this decade to over $110 trillion by 2030, presenting significant opportunities to invest.

Alpha Potential is gaining traction as another important quantitative tool. Its use lies in identifying opportunities for active management of Australian equities amongst other asset classes.

Investing in unconstrained fixed income strategies with more flexibility to change duration and sector exposures can have a positive impact on a portfolio’s overall risk and return profile.

If risk and return are imperfectly linked, there is opportunity to increase average return, without increasing risk - particularly in equity markets where risk is mispriced.

In many cases, fundamental risk and return characteristics have been shown the door as funds have flowed into ever lower yielding income asset classes.

The last decade has seen a distinct disconnect between investment risk and return, versus what we're taught should be the case.

Fixed income has changed, and is very different today versus what it was years ago. It makes sense to evolve your portfolios accordingly.

What are the questions that everyone is asking today? When will interest rates spike? And, what about the increased rate of inflation? One has to accept the changing nature of these two elements.

The constant challenge is to keep clients focused on their wealth goal when they are distracted by the many other factors that influence their perception of risk.

To improve client outcomes, financial practitioners must master six basic response skills.

Belief and philosophy when it comes to investing are not enough. Without culture and rigour, it is highly unlikely an investor will maintain their beliefs in all market conditions and cycles.

A common belief amongst financial practitioners is that investors and clients understand the investment objective. But are our investment beliefs a reflection of reality or investment myths?

Needleman said, "Money has a way to bring reality to situations". If so, the challenge is to have more scientific clarity helping to expose what money (and therefore investing) represents in a client's world.

Finology is the emerging (and converging) research field covering the study of minds, customs and behaviours with respect to money. It incorporates behavioural finance, and much, much more.

There may be rocks ahead. Reconnecting risk and return must be the right focus - but thinking conventional tools will keep us out of trouble may be a mistake.

Going forward, instead of 5% real, traditional stocks and bonds will offer about 2.5%. But there are many things you can do to bridge the gap.

Here are some brief thoughts on four issues that matter a lot, in our view. Two have been poorly discussed in the financial press, and the other two have been ignored completely.

Three interrelated aspects of practically managing client portfolios - constructing portfolios using buckets, diversifying human capital, and the Withdrawal Policy Statement.

Our Symposium NZ 2014 faculty debated that the best way for practitioners to manage a client's primary risk of not meeting their objectives is to manage the long-term uncertainty of returns.