In a matter of months, a U.S.-led unipolar world has fractured into rival power blocs, each intent on reshaping global rules in its own image. America, still the world’s largest economy, has turned sharply inward, prioritising domestic industry and political resilience over multilateral coordination. Europe faces structural decline, weighed down by demographics, energy dependency, and political drift. China is recalibrating its growth model, while the other BRICs sense their moment to rise. The global centre of gravity is shifting – and geopolitically speaking, we are only in Act One.

For investors, the questions multiply. Will U.S. assets retain their premium in a protectionist world? Can the dollar sustain dominance in the age of digital currencies and capital bifurcation? How long will bond markets remain patient with governments struggling to reconcile fiscal reality with populist ambition? There is no model that perfectly prices geopolitical entropy. But one truth endures: asset allocation – always important – now becomes existential.

In benign markets, asset allocation is the quiet force behind long-term performance. In unstable markets, it becomes the single most important determinant of survival. The balance between equities and bonds, the role of alternatives, and the tilt toward global currencies will define resilience as the rules of global engagement are rewritten. Diversification, once a statistical exercise, is now a strategic imperative.

Governments are stepping back into the economy – not as referees, but as players. Industrial policy, fiscal activism, and national security considerations now blur the line between markets and the state. Bond markets may again find themselves at odds with political will, while companies must navigate not only consumer preferences but the gravitational pull of government influence. In this world, sectoral winners and losers will increasingly be chosen not just by the market, but by ministerial decree.

The implication is clear: portfolios built for a frictionless world will struggle in a politicised one. Investors must now think not only in terms of diversification of assets, but diversification of regimes – across regulatory systems, fiscal frameworks, and political cycles. The new diversification is not just geographic; it is ideological, recognising that capital flows and policy priorities no longer move in tandem. In this environment, resilience depends less on prediction than adaptability – the ability to operate across multiple economic realities without being captive to any single one.

Our central concern is straightforward: tariffs are taxes by another name, and consumers rarely enjoy paying more for the same basket of goods. Most economists agree that tariffs will raise inflation and dampen growth in the near term. The inflationary pulse may be temporary; the growth drag, less so. That is not a comfortable setup for equity markets already priced for perfection and dependent on margin resilience.

Of course, this is not 1934. Today’s policymakers have far more sophisticated tools – but those tools were designed in a tariff-light, globalised world. Overlay this with modern dynamics such as the re-shoring of supply chains, the securitisation of industrial policy, and the strategic drive to localise emerging sectors, and the old playbook begins to look fragile. Inflation and growth will no longer move in predictable opposition; instead, they may coexist in uneasy balance.

We also expect some degradation in corporate fundamentals – not necessarily from the tariffs themselves, but from the uncertainty they generate. Investment decisions will slow, capital costs will rise, and consumers may hesitate. Add the gradual withdrawal of pandemic-era fiscal buffers, and the outlook becomes more constrained – unless, of course, one places extraordinary faith in the productivity promise of artificial intelligence. Markets already seem to.

This is not a counsel of despair. In periods of dislocation, credit often leads recovery. We believe high-quality corporate credit and selective emerging-market debt can deliver equity-like returns with lower risk – particularly at the short end of the curve, where duration risk remains contained and yield is finally real. The focus, as ever, is not on chasing yield but on capturing resilience.

Accordingly, we have trimmed equities into strength and rotated toward fixed income – favouring quality issuers, shorter maturities, and flexible mandates that allow tactical adjustments. This is not a retreat from risk; it is a reallocation of it. In uncertain cycles, consistency and liquidity become performance levers in their own right.

Alternatives will also play a larger role – not the baroque, high-octane kind, but the disciplined, all-weather strategies that deliver compounding through quiet asymmetry. Currency exposure, meanwhile, must be viewed in context. For USD-based investors, measured diversification remains sensible – particularly in portfolios heavier in fixed income, where stability often trumps asymmetric upside.

Ours is a long-term mandate. Clients do not expect us to gamble on geopolitics, but to manage risk with foresight and discipline. That means allocating not only for a volatile quarter, but for a volatile decade – designing portfolios that can absorb structural shocks and still compound over time. In a world where uncertainty is policy rather than exception, endurance becomes a competitive advantage.

The global order may be fragmenting, but thoughtful portfolios need not. Resilience today is not built on prediction, but preparation – the quiet strength that comes from being diversified across both assets and assumptions. In a world where volatility is structural and certainty rare, balance becomes its own form of outperformance. True endurance lies in composure – the ability to adapt without losing conviction. In a divided world, the most powerful statement an investor can make is not haste, but steadiness.