Investments

21 May 2026

Thia article first appeared in The Australian Financial Review

By Michael Saadie, Executive, NAB Private Wealth and Chief Executive, JBWere

In a world where there is heightened uncertainty, investor confidence is repeatedly put to the test. Sharp market swings, geopolitical instability, rapid policy shifts and technological disruption have become familiar features of the global landscape. For many investors, the question is no longer whether uncertainty will arise, but how to invest sensibly while it persists. 

Periods of uncertainty are also periods when mistakes are most easily made. Higher-risk environments can magnify gains, but they amplify losses just as quickly. The challenge for investors is to remain clearheaded when emotion and headlines threaten to take control of decision making. 

From a wealth management perspective, sustained global uncertainty can strengthen the case for remaining invested through the cycle with a well-defined, long-term strategy. Markets, despite regular setbacks, have demonstrated a persistent upward bias over time. Corrections, even severe ones, tend to smooth out when viewed over longer horizons. Consistently timing markets has proven notoriously difficult, and sitting on the sidelines often carries its own opportunity cost. 

That said, taking a long-term approach does not mean remaining passive or disengaged. Modern portfolio management is increasingly dynamic, requiring active oversight rather than blind patience. Investors today are typically exposed to multiple asset classes across different geographies, time horizons and purposes. Each element within a portfolio serves a role, whether that is growth, income, capital preservation or liquidity. 

The unifying objective remains diversification, particularly across assets that behave differently from one another. Uncorrelated assets are central to portfolios designed to perform through varying market conditions. Diversification is not about chasing every opportunity, but about constructing balance. When one part of a portfolio is negatively affected by global, regional or domestic events, another part may benefit from those same conditions. 

For instance, in the first quarter of this year balanced portfolios with a material exposure to energy or similar sectors likely saw gains due to impacts from the Middle East conflict. Portfolios without those exposures likely experienced losses. The Middle East situation remains fluid, and an analysis of how various asset classes performed against each other will be well studied post the conflict. 

However, there are some clear illustrations in recent history that provide insights into asset performance. 

The 2020 pandemic triggered extreme volatility across global markets, followed in quick succession by inflationary pressures, aggressive interest rate hikes, heightened geopolitical risks and renewed trade tensions. Yet it was also a period of extraordinary gains in market sectors, particularly in technology and, more recently, artificial intelligence. 

Global equities initially sold off sharply at the onset of the pandemic but rebounded strongly as policy stimulus took effect and economies reopened. The rally that followed was largely driven by the United States, with technology giants leading the charge. The so called “magnificent seven” delivered considerable momentum, while many other international markets lagged. China and parts of Europe, for instance, struggled under slower growth, regulatory uncertainty and structural headwinds. 

At the same time, other assets played a valuable supporting role. Gold and commodities performed strongly as investors sought protection against inflation and geopolitical risk. Infrastructure and select real assets offered inflation linked cash flows, while short duration fixed interest provided relative shelter as interest rates rose. In contrast, long duration bonds suffered as yields climbed, eroding capital values.  

Private capital markets also faced challenges, with liquidity constraints and tighter regulatory scrutiny complicating the environment. Listed markets are already signalling this risk through discounts to Net Asset Values (NAV) and declining private asset manager share prices.     

These differing outcomes underline the importance of diversification not just across asset classes, but within them. It also highlights the need for portfolios to evolve. Rebalancing is not about reacting to every market wobble, but about recognising medium to long term trends and adjusting exposures accordingly. Crucially, these decisions must be aligned to an individual investor’s objectives, liquidity needs and tolerance for risk. 

In an increasingly complex investment landscape, trusted advisers remain central to effective wealth management. The value they bring extends beyond asset allocation models. It includes access to global opportunities, disciplined risk management, robust research and an understanding of how portfolios fit into broader financial and family goals. For many investors, particularly those with inter‑generational considerations, this integrated approach is a significant consideration. 

Investing ultimately requires patience, perspective and preparation. It can begin with a first investment in a share, exchange traded fund or property, and scale over time into sophisticated structures supported by teams of experts. The principles, however, remain consistent: diversification, discipline and a clear understanding of why each investment exists within a portfolio. 

When investors ask when a good time to start is, the answer is almost inevitably now. Uncertainty is not an aberration; it is a constant feature of markets. Waiting for clarity often means waiting indefinitely. By focusing on how assets are allocated, how they interact with one another and how they align with long term objectives, investors can move forward with confidence—even when volatility dominates headlines. 

The information contained in this article is intended to be of a general nature only. It has been prepared without taking into account any person’s objectives, financial situation or needs. Before acting on the information in this article, you should seek professional advice and consider whether it is appropriate for you in light of your objectives, financial situation and needs. Terms, conditions, fees, charges, eligibility and lending criteria apply to NAB products. © National Australia Bank Limited ABN 12 004 044 937, AFSL and Australian Credit Licence 230686. 

Investments