Geopolitics is front and center. The global economy seems resilient. Does this affect your appetite for risk assets and what 2026 might be like?
Host
Jean Chia
We started the year with a risk-on stance. Supportive factors are the low interest rate environment and strong economic fundamentals. Our overweight is not on the US but on Asia/Japan.
Is it just a valuation story for Asia equities, or do you see cyclical factors?
Host
Jean Chia
Two parts: AI proliferation is moving to 1-to-N applications in Asia. Capital allocation may start to shift away from the concentrated US overweight.
What are clients asking about gold? Is it beyond a tactical trade?
Host
Jean Chia
We've allocated to gold for two years in our strategic asset allocation. It's a ballast for the portfolio, not just a tactical trade.
How should we look at bonds given the attack on the Fed? Does that undermine the Treasury market?
Host
Jean Chia
We are relatively neutral on duration because of uncertainties about where rates go. The timing of expected rate cuts is dependent on Fed developments and data.
Japan's been favored. Does the political/news change anything from a top-level perspective?
Host
Jean Chia
We look for fundamental change in Japan's economy. The yen will be volatile due to US dollar volatility. We remain constructive as North Asia is a beneficiary of flows looking for AI proxies.