Portfolio

So far most of the value in the AI supply chain has been captured by hardware companies. However, as model providers shift to usage-based pricing, value will begin to accrue to models and applications. Communications Services and Software should benefit from this shift. This broadening of the AI story, along with solid economic momentum should keep the rally going for the rest of the year. Remain overweight equities. Downgrade Energy to Neutral. Buy Software.

MacroQuant recommends a slight underweight position in equities, favors a below-benchmark duration stance in fixed-income portfolios, is very positive on the US dollar, downgrades gold to underweight, upgrades copper to overweight, and remains very bullish on oil.

In Private Markets, yesterday’s winners often see outperformance fade. Top-quartile managers often regress toward the median as fund series mature. For investors evaluating the next Real Estate or Private Equity manager: Bias toward underweighting Funds V and beyond.

Special Report

Private Equity fund vehicles may extend beyond 10 years, but the underlying assets that drive performance typically do not. We provide the framework for investors to capitalize on this reality.

The Strait of Hormuz remains closed. Even if the Strait were to open tomorrow, global consumers will be squeezed for the rest of the year. However, AI capex is accelerating, and signs of ROI are emerging. This capex boom will keep the world from an economic downturn. Upgrade equities to overweight and downgrade cash to underweight. Upgrade the US and downgrade Europe and Australia. Upgrade Communication Services.

MacroQuant recommends an underweight position in equities, favors a below-benchmark duration stance in fixed-income portfolios, is neutral-to-slightly positive on the US dollar, remains neutral on gold, upgrades copper to neutral, and is very bullish on oil.

Special Report

Europe has been too ambitious with Renewables. Oversupply, volatility, and rising contract risk are compressing revenues and returns. The space is now crowded yet markets have not fully repriced the risk. New opportunities are emerging: Power Storage and Data Centers have upside.

We remain overweight APAC in both Private Equity and Venture Capital, recognizing the region and its opportunities have evolved meaningfully. Buyouts are growing faster than many realize, driven by Japan, while a deeper reset in fundamentals versus global markets supports stronger upside potential.

Special Report

We have received several questions from clients regarding practical issues surrounding strategic positions on gold. We find that gold is liquid and relatively inexpensive to trade while being a reliable diversifier that provides enough excess returns to account for loss in yield.

Special Report

The Iran war provides a timely motivation for examining how the main financial asset classes and commodity sectors perform across different inflation regimes and during periods of elevated geopolitical risk.