A sustained period of lower global growth, rich valuations from traditional assets and an eerie calm before the storm in asset price volatility require a different approach to asset allocation.

Public equity valuations have disconnected from underlying earnings and there is a distorted link between perceived and actual risk.

In managing a risk on/risk off world, investors can maintain or increase exposure to growth assets while experiencing a smoother ride.

The top six stocks in the ASX 300 represent 45% of market cap and 50% of market risk. A 4% TE constrained manager must hold 15%-20% in these six stocks even if they do not like them.

The seismic shift in fixed income after a 30-year bull market for bonds has created significant portfolio construction challenges and opportunities.

To ensure risk is genuinely well diversified takes a forward-looking scenario-analysis process to combine quantitative rigor with qualitative insights of the plausible but unlikely extreme stresses we might face.

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.