The Australian Financial Review recently featured our insights on navigating the extreme market volatility triggered by escalating tensions between the United States and Iran in March 2026. As investors responded to President Trump's ultimatum to Iran over the Strait of Hormuz closure, followed by announcements of postponed military strikes, the Australian sharemarket tumbled to a 10-month low before rebounding on peace talk optimism.
As a global equities fund managing investments across international markets, we've witnessed unprecedented market swings during this period. Our portfolio manager Thomas Rice explained how the conflict prompted a fundamental reassessment of energy security, creating opportunities in electrification investments. He purchased Chinese electric-vehicle maker BYD during this turbulent period.
"One thing that's really stood out through this period is that diversification hasn't been the beneficiary it usually is. Defence stocks have underperformed relative to what you'd expect, and precious commodities haven't provided a reliable hedge either. That partly reflects profit-taking, but it also speaks to how messy and non-textbook this market has been."
Rice's observations highlight how traditional diversification principles can break down during extraordinary geopolitical events, requiring portfolio managers to adapt their strategies and identify opportunities emerging from market dislocations. To read the article, click the link below.