Multi-Asset: Positioning portfolios with selective risk
We see an overall constructive market backdrop with easing inflation and softer growth in the medium term, amid policy shifts and global uncertainties.
2 December 2025
Article
Inside the markets | Helping you guide clients
11 May 2026
Transcript
David Aujla narration:
Disclosures (not being read, only showing up on screen):
Inside the markets | Helping you guide clients. David Aujla, Portfolio Manager, Multi-Asset Solutions. Data as at 30 April 2026. This video was recorded 07 May 2026. This video is for Professional Clients only and is not for consumer use.
Hello, and welcome to the April edition of Inside the Markets, a deeper look at how global markets have been navigating what, quite frankly, has already become a very eventful start to 2026. My name’s David Orgelar, and I’m the lead portfolio manager for Invesco Summit and managed multi-asset fund ranges, and its model portfolio service, or MPS.
Well, if March was around shock and escalation, then April was about uneasy stabilisation.
On screen text: Shift from shock to stabilisation as ceasefire eases risks
A temporary ceasefire framework between the US, Israel and Iran reduced immediate risk around the Strait of Hormuz, even though that agreement remains fragile and far from a lasting settlement.
Oil prices have stayed elevated, but some of the most acute worries about supply disruption eased, allowing investors to shift their attention back towards things like earnings. But of course, inflation data and the interest rate outlook remained in sharp focus.
Against that backdrop, markets moved back into risk-on mode.
On screen text: Markets return to risk‑on, with equities rallying
Global equities delivered strong gains, with the US, Japan and Europe all advancing, but it was emerging markets that led the pack.
On screen text: Rally broadens beyond mega‑cap tech to small caps and cyclicals
The rally also broadened out in nature, with global small caps and cyclicals participating, rather than performance being confined to a narrow group of mega cap growth and AI-linked stocks. Closer to home, UK equity returns were also positive, but more modest in nature.
Fixed income had a quieter but still positive month, although not nearly as strong as equities. Government bond returns were broadly flat or slightly positive depending on the market, as yields stopped rising sharply. Credit performed better, with higher-yield and emerging market debt outperforming higher-quality investment-grade credit.
In alternatives, global listed real estate rebounded strongly as some of the more pessimistic assumptions around growth and policy that had weighed on that part of the market in prior months were priced out and risk appetite improved generally.
On screen text: Oil remains supported, gold falls as investors move back into risk assets
Oil, as mentioned, edged higher as ongoing supply concerns and that delicate ceasefire kept a firm floor under prices.
Gold, by contrast, slipped over the month as safe haven demand faded at the margin and capital rotated back towards risk assets after March’s turbulence.
Stepping back, April left global equity markets comfortably positive year to date, with emerging markets, small caps and more cyclical areas regaining ground after the setback in March. Fixed income is still wrestling with the push and pull between attractive income and the higher-for-longer rate expectation, but total returns remain modestly positive for many core bond indices.
For gold, April’s decline has chipped away at earlier gains, reminding investors that even classic hedges can be volatile when positioning is crowded and narratives shift quickly, as they have done this year.
Looking ahead, we’re focused on four key things.
On screen text: Our focus looking ahead, Developments around Iran and wider Middle East, Central banks, Does broadening market leadership persist? Diversification remains key in rapidly shifting markets
First, developments around Iran and the wider Middle East remain important. The ceasefire has reduced immediate downside risk, but it is far from certain, and how oil behaves from here will shape both inflation expectations and economic growth sentiment.
Secondly, we’re watching central banks very closely. The Fed and the Bank of England both left rates on hold in April, but with more visible internal disagreements and a sharper focus on how higher energy prices might keep inflation sticky. Whether they feel able to start cutting later this year, or are forced to stay on hold for longer, will matter a great deal for both bonds and rate-sensitive equity sectors.
We also continue to monitor whether the broadening of market leadership persists. April saw emerging markets, small caps and a wider range of cyclicals participate in the rally, but it remains to be seen whether that trend proves durable, or whether markets rotate back to a narrower group of mega cap growth stocks. We think that rotation may still have some legs, but the outcome will be important for regional and style allocations and performance.
Finally, April has reinforced a familiar lesson on diversification. Within a few short weeks, we have seen environments where energy, cash and defensive assets were the main drivers of performance, followed by a month where risk assets broadly bounced back and traditional hedges, like gold, lagged.
Our view is that maintaining a genuinely diversified portfolio, with a mix of assets, sectors and styles, remains essential when macro, policy and geopolitical conditions are shifting as quickly as they have this year.
Thank you for taking the time to watch this month’s review. I hope you found it useful and, as ever, please get in touch with any questions you may have. I’ll see you next month.
Investment risks
The value of investments and any income will fluctuate (this may partly be the result of exchange rate fluctuations) and investors may not get back the full amount invested.
Important information
Data as at 30 April 2026
This is marketing material and not financial advice. It is not intended as a recommendation to buy or sell any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication.
Views and opinions are based on current market conditions and are subject to change.
Your monthly guide to last month’s market events and what this could mean for your clients. Inside the Markets goes beyond headlines to break down the month’s most important multi‑asset movements and what they mean for investment decisions.
April market update
Shift from escalation to fragile stabilisation
April marked a shift in market tone, moving away from the sharp escalation seen in March towards a period of uneasy stabilisation. A temporary ceasefire between the US, Israel and Iran helped reduce immediate risks around the Strait of Hormuz, although the situation remains fragile and far from resolved.
Equities rebound as risk appetite returns
With some of the most acute geopolitical concerns easing, investor focus returned to fundamentals, including earnings, inflation data and the outlook for interest rates. This supported a broader return to risk sentiment, with global equity markets posting strong gains across the US, Europe and Japan, and emerging markets leading performance.
Market leadership begins to broaden
Importantly, the rally was not confined to the narrow group of mega‑cap growth and AI‑linked stocks that have dominated in recent quarters. Instead, market participation broadened to include small caps and more cyclical sectors, suggesting a potential shift towards more balanced leadership across equity markets.
Oil remains elevated while gold retreats
In commodities, oil prices remained elevated, underpinned by ongoing supply concerns and continued geopolitical sensitivity, even as near‑term disruption risks eased. In contrast, gold moved lower over the month as safe‑haven demand softened and investors rotated back into risk assets following March’s volatility.
Fixed income delivers modest gains
Fixed income markets delivered more modest returns. Government bonds were broadly flat to slightly positive as yields stabilised, while credit markets performed more strongly, particularly in higher yield and emerging market debt.
Central banks remain in focus
Central banks remain firmly in focus. Both the Federal Reserve and the Bank of England kept rates on hold in April, but with growing uncertainty around the path ahead, particularly as higher energy prices risk keeping inflation elevated. As a result, expectations for rate cuts later in the year remain uncertain and highly sensitive to incoming data.
What this could mean for investors
Markets have quickly shifted from a defensive stance to a more risk‑on environment, underlining how rapidly sentiment can change in the current backdrop. The broadening of equity market leadership beyond mega‑cap stocks may create a wider opportunity set across regions and sectors, while persistently elevated oil prices could continue to influence inflation and the timing of interest rate cuts.
Against this backdrop, maintaining diversification across asset classes, regions and styles remains important, alongside a flexible approach that can adapt to evolving geopolitical risks, policy uncertainty and changing market dynamics.
Additional Resources
- Multi-Asset Solutions - By incorporating equities, fixed income, cash, and alternative asset classes, our multi-asset solutions are designed to solve the most complex challenges.
- Intelligence Plus - We know success is more than just technical know-how. It requires a rounded skill set that blends technical knowledge with the ability to grow a business and build meaningful connection with clients. Intelligence Plus is designed to meet that need.
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