Key Takeaways

• Commodities are our sole conviction Overweight, supported by constrained supply, improving Chinese industrial activity and strong momentum.
• All major equity regions remain Neutral: earnings are supportive, but valuations, concentration and policy risks limit conviction.
• Within government bonds, we favour intermediate US maturities while remaining cautious on long-duration international exposure.
• Tight spreads offer insufficient compensation for risk, leaving US investment-grade and high-yield credit Underweight.
• Portfolio resilience depends on quality, diversification and disciplined position sizing rather than chasing narrow market leadership.

Positioning snapshot: Commodities are Overweight. All major equity regions, emerging-market debt and intermediate US government bonds are Neutral. US investment-grade credit, US high-yield credit and international government bonds are Underweight.

Participate, but Stay Selective

October’s outlook calls for participation without complacency. Our first priority is to retain diversified equity exposure while reducing dependence on narrow technology and semiconductor leadership. Second, we favour intermediate US government bonds and selective emerging-market debt over long international duration and broad credit exposure, while keeping emerging-market debt close to its strategic benchmark weight. Third, we maintain a measured Overweight to commodities for diversification and inflation sensitivity.

Together, these decisions preserve access to growth while retaining liquidity for periods when valuations offer a better margin of safety.

For long-term investors, the central message is to prepare rather than predict. Remain diversified, favour quality and liquidity and reserve conviction for assets where prospective returns clearly compensate for the risks.