Broad equities
A foundation for participation across industries and businesses. We also examine the concentration and theme exposure already present within broad market funds.
PORTFOLIO FRAMEWORK
Growth opportunities, considered as a whole.
We study how broad equity exposure, selected industry themes and assets with different risk drivers can work together. Our preferred research direction balances long-term growth opportunities with concentration risk and the flexibility to respond when evidence changes.
01 / Portfolio roles
Different assets, distinct roles
A portfolio should be understood through its underlying risks, rather than the number of securities it contains. Different instruments may share the same companies, customers or economic drivers.
Selected themes
Focused research into computing, memory and supporting infrastructure. Industry growth must be weighed against valuation, competition and the ability to convert investment into cash flow.
Diversifiers
Gold is studied for its distinct monetary and macroeconomic drivers. Digital assets are assessed separately: their volatility and equity sensitivity make them different from conventional defensive assets.
Liquidity
Short-term government securities and cash can preserve flexibility for future decisions. Their role is considered alongside currency exposure, reinvestment risk and the opportunity cost of holding reserves.
02 / Choosing an approach
Why we favour a multi-asset research path
We compare several approaches rather than treating one favourable historical window as a final answer. Each route exchanges some participation in upside for a different set of risks and constraints.
| Approach | Rationale | Trade-off | Research position |
|---|---|---|---|
| Concentrated themes | Express an industry thesis directly through selected companies and supply-chain segments. | Greater dependence on individual businesses, valuations and shared customer demand. Strong industry growth can still coincide with poor investment outcomes. | An alternative for comparison, with close attention to concentration and overlapping exposures. |
| Diversified multi-asset approach | Combine broad equity participation and selected themes with assets serving different portfolio roles. | May lag a strongly rising theme. Correlations can increase during stress, and diversification does not ensure protection against losses. | Our preferred research direction, assessed through growth potential, resilience and flexibility together. |
| Trend-based defensive rules | Study whether pre-defined signals can improve portfolio behaviour during sustained market weakness. | Signals can react late, increase turnover or miss rebounds. Their usefulness depends on the market environment and implementation assumptions. | A separate research question, requiring comparison with a consistent static allocation. |
03 / Research process
A process open to challenge
A useful investment thesis explains both why an opportunity may exist and what evidence would make us reconsider it.
- 01
Define the thesis
Identify the potential source of returns and distinguish established facts, research judgments and assumptions that remain untested.
- 02
Write down the counter-evidence
Set out observable indicators and conditions that would challenge the thesis, such as higher real yields, lower capital spending, rising inventories or weaker pricing power.
- 03
Compare alternatives consistently
Use consistent periods and cost assumptions when comparing portfolio approaches. Examine sensitivity to the choice of securities, data sources and market windows.
- 04
Test adverse conditions
Consider how inflation, slower industry demand and liquidity stress could affect valuations, correlations and the role of diversifiers.
- 05
Review and preserve the reasoning
Retain data sources, model versions and decision rationale. When new evidence conflicts with an assumption, assess its quality before revising the research conclusion.
04 / Adverse scenarios
Looking beyond the central case
These scenarios are questions for research, not predictions or assigned probabilities. They help identify where a portfolio may be vulnerable.
Renewed inflation
Higher real yields and tighter financial conditions could weigh on growth valuations. Gold may not provide the expected offset.
Review the policy assumptions, valuation sensitivity and the evidence behind each asset’s portfolio role.
Slower AI investment
Lower capital spending or weaker returns on investment could affect computing, memory and data-centre supply chains together.
Revisit customer spending, order conversion, inventories and whether expected earnings can support valuations.
Liquidity stress
Risk assets may fall together, while gold can also come under short-term selling pressure. Historical correlations may offer little guidance.
Examine liquidity needs, overlapping risk exposures and the practical ability to rebalance under stressed conditions.
05 / Limits of the framework
What the research cannot establish
- Historical comparisons depend on their sample, instruments and assumptions. Selecting securities with knowledge of subsequent outcomes can introduce selection and survivorship bias.
- A favourable historical comparison does not establish out-of-sample validity. Future returns and losses may differ materially from research results.
- Transaction costs, taxes, currency movements, data conventions and changing correlations can alter conclusions. A model cannot capture every implementation constraint.
- Dynamic rules can lag abrupt market moves and miss rapid recoveries. Neither diversification nor a signal sets a guaranteed limit on losses.
- The framework describes research methods and judgment. It is not personalised investment advice, an offer to invest or a promise of performance.
CONTINUE EXPLORING
Investment thinkingThese pages describe our investment research and reasoning. They do not provide individual investment recommendations or a commitment to achieve particular returns.