Real Assets

VantagePoint: The Iran War Fuels the Case for Portfolio Resilience

The Iran War is testing markets’ tendency to look past geopolitical shocks. Alternative shipping routes, inventory drawdowns, and supply outside the Middle East have kept crude moving, but refined fuels and LNG remain constrained, leaving little room to absorb further disruption. Our base case is a simmering conflict with partial energy flows and elevated, volatile costs, while wider disruption could push inflation higher and slow growth. Investors should stress-test portfolios alongside spending needs and other obligations, reduce overlapping exposures, and add distinct return drivers while retaining growth holdings supported by long-term valuations.

Review of Market Performance: Fiscal Year 2026

The commodity supply shock mildly slowed global growth, though the effects varied by region. Even so, global equities posted another strong fiscal year across a broad set of markets. The US dollar appreciated modestly, with the United States remaining relatively insulated from developments in the Middle East. Bond returns lagged as inflation pressures resurfaced, while real assets performed strongly as the supply shock intensified and demand tied to AI buildout continued to strengthen.

VantagePoint: Artificial Intelligence Investing After the First Wave

AI investing is moving into a more selective phase: capabilities and adoption continue to accelerate, fundamentals are starting to improve, and the obvious first-wave winners in hyperscalers and chips have already been widely recognized by markets. From here, the key investment questions are which bottlenecks will endure, whether revenue and earnings can outpace the capital intensity required to lead, and where lasting value can survive as AI becomes cheaper, more capable, and more ubiquitous.