The Portfolio Construction Forum (PCF) Market Summit 2025 concluded last week, offering thoughtful discussions on some of the most pressing issues in today’s markets. This year’s theme, “Mind the Gap,” resonated strongly, shedding light on the widening divides in global economies and the differing views on how investors might respond. Directors Jonathan Tolub and Jonathan Ramsay reflected on the summit’s key themes, sharing insights that may prove valuable for advisers.

Exploring Divides: Political Dynamics and Portfolio Implications

The most talked about session from the summit was the session led by Pippa Malmgren. Malmgren challenged prevailing narratives by suggesting that there may be a deliberate strategy behind what many perceive as disorder in Trump’s approach. Rather than dismissing recent political developments as erratic, she argued that these moves could be part of a calculated effort to reshape global power dynamics.  Her presentation touched on various ideas such as the influence of cryptocurrency in political strategy, unconventional economic policies, and shifts in global alliances.

This theme of political influence on portfolios was further developed in presentations by Jonathan Pain and Ron Temple. Their sessions took a more conventional approach, focusing on the practical implications of U.S. economic policies, including tariffs, immigration reform, deregulation, and tax cuts. They discussed which factors are already reflected in market valuations and which may represent opportunities or risks still unpriced.

Investment Strategies: Opportunities Beyond the Obvious

Discussions at the summit also examined strategies that could offer potential value in an uncertain market environment. Several sessions took a contrarian perspective, highlighting areas that have underperformed in recent times but may present opportunities ahead. Topics included global small caps, emerging markets, Australian mid-caps, and infrastructure investments. Notably, there was limited focus on the high-performing U.S. mega-cap tech stocks, signalling that attention may be shifting towards more diverse areas of the market.

The debate between listed and unlisted infrastructure assets attracted particular interest, with speakers suggesting that a balanced approach may be appropriate depending on individual portfolio requirements. The private equity session provided a broad overview of how private investments can fit into a portfolio, emphasising long-term growth potential while acknowledging the need for careful consideration of associated risks.

Transparency in Private Credit and Other Emerging Themes

A notable development came from Metrics, a key player in private credit, which announced plans to increase transparency—a move that could significantly reshape perceptions of this asset class. Given the concerns surrounding private credit, particularly regarding leverage in overseas markets, this commitment to transparency may help advisers better assess the associated risks and opportunities.

From Insights to Implementation

While the summit presented a wide range of viewpoints and strategies, the focus now shifts to practical application. The forthcoming Implementation Workshop on 27 February from 12 - 1:30 pm (AEDT) will explore how these discussions can be translated into actionable portfolio strategies. 

Register for the Implementation Workshop here: https://services.brillient.com.au/register/markets-summit-2025-implementation-zoominar/delegate