InvestSense

Greg D. from Langdon Equity Partners joins Director Jonathan Ramsay to explore why small-cap stocks can present compelling long-term value—even in uncertain markets. While small caps aren’t immune to volatility, market swings often create opportunities to invest in high-quality businesses at attractive valuations. Unlike large-cap stocks, which are often priced for perfection, many small caps remain overlooked and undervalued despite strong fundamentals. For long-term investors, this strategy not only enhances diversification but also offers the potential for outsized returns as market inefficiencies correct over time.

Decoding a Changing Economic Order, join us for a CPD Webinar with Economist Andrew Hunt. Trade wars, rising debt, inflation risks, and financial systems under strain. Markets are facing pressures not seen in decades. The implications for investors? Unavoidable.   Andrew returns to Australia to challenge how we interpret these structural shifts. Drawing from his conversations with policymakers, he’ll break down what really matters—what’s real, what’s noise, and how it impacts portfolios.   Get these insights from Andrew on Friday, March 28, in our CPD-accredited webinar. Webinar Details Date: Friday March 28, 2025 Time: 10:30 AM - 11:30 AM AEDT Register Now:  https://lnkd.in/gGaVJ5i5

The last decade has transformed financial advice, but some things remain the same. Technology expanded investment solution possibilities, giving advisers and clients more options than ever before. Yet, one thing remains constant: clients want a trusted partner, someone who can guide them through complex decisions with clarity and confidence. Applying institutional-level investment processes through Managed Accounts and partnering closely with advisers leads to what matters most: consistent, reliable outcomes that clients not only see but understand. Because the adviser’s role goes beyond technical expertise. It’s about maintaining an unbroken chain of understanding, turning complex options into confident decisions. The result? Clients who are better informed, more engaged, and ultimately making smarter financial choices. As Duncan Murray puts it: “I certainly can say that we’ve got a better system, a system that provides more certainty because it’s more consistent.” This consistency, paired with deeper client engagement, drives better decisions. As Justin Gilmour explains: “Clients are a lot more engaged. They’re making better decisions because we’re modelling scenarios through time, not just at review time.”

Could we be entering a capital repatriation world? The idea isn’t as far-fetched as it sounds. Economist Andrew Hunt spoke with Director Jonathan Ramsay about the potential for global capital flows to shift back to home markets. Such a move could overturn decades of financial patterns, disrupt established correlations, and create both risks and opportunities for investors. With U.S. fiscal tightening, rising geopolitical tensions, and the rapid growth of crypto assets reshaping the investment landscape, we may be witnessing the start of a regime change. Listen to what this could mean for investors: https://lnkd.in/gQGr5uSi Andrew will be joining us at the end of March to dive deeper into the macro factors driving these shifts. Get in touch with our team if you’re interested in joining a session.

If you're at the Slipstream Group Connect Conference, come visit our stand and say hello to Stephen Poole to learn more about how InvestSense has partnered with advisers to grow their business with managed accounts.

The Portfolio Construction Forum 2025 Markets Summit Preview gets underway this morning challenging speakers and attendees to ‘mind the gap(s)’. Directors Jonathan Tolub and Jonathan Ramsay share a preview of the sessions which features some of the most pressing issues facing investors. Notably, this year’s agenda leans more contrarian than in previous summits. Multiple sessions will delve into underperforming asset classes, such as global small caps, emerging markets, infrastructure, commercial real estate, and Australian mid caps. Meanwhile, the high-flying U.S. mega cap tech stocks are receiving less airtime, reflecting both their lofty valuations and questions about a potential leadership rotation in the markets. Get a tease of the sessions here: https://lnkd.in/gC8Mvvsi With plenty of “grist for the mill,” this year’s sessions offer thought-provoking ideas and tangible, often contrarian, strategies. These insights will flow into the Implementation Workshop on February 27, where we’ll walk attendees through translating these emerging concepts into practical portfolio tactics. If you’re interested in joining, please get in touch.

There is comfort in a broad index—a market that moves with the economy, reflects it, absorbs it. Until it doesn’t.   The ASX 200 is dominated by banks and resource companies, sectors that once drove strong returns but now face structural challenges. Banks are expensive, with limited earnings growth. Resources remain highly cyclical, swayed by trade policies and political shifts. Despite this, Australia’s market appears cheaper than global peers but dig deeper, and the valuation story is more complex. Last week, Director Jonathan Tolub joined the H&B Wealth Symposium in Queensland to look beyond the index, where real opportunities lie.   Outside the top 20 companies, mid-caps offer some potential, but valuations are stretched. Small caps, however, present a different opportunity. While they come with risks—higher volatility, stock selection challenges—their long-term return potential makes them worth considering. But finding quality growth requires more than just moving down the size spectrum, it demands a more intentional approach to portfolio construction. The ASX 200 may no longer be enough as a core allocation. Whether through small caps, active strategies, or smart beta, investors need to go deeper—evaluating risk and return with a forward-looking lens to ensure portfolios align with their objectives.   Thank you to Adele Brown & Lucy Hannemann for hosting an insightful event that opened the discussion to think beyond the index.

Crypto Collateral: A lifeline for the U.S. economy or a dangerous gamble? U.S. regulators are now allowing crypto assets to be used as collateral in mainstream finance, a move that could inject up to $500 billion into the U.S. economy. Economist Andrew Hunt sees this as part of a broader effort to sustain growth, but he warns it comes with major risks. By encouraging lending against crypto, the SEC could fuel a cycle where rising digital asset prices drive greater demand for Treasury bills, a dynamic that could temporarily boost liquidity but also create new vulnerabilities. If the crypto bubble bursts, the knock-on effects could ripple across both digital and traditional markets, amplifying volatility. With rising debt levels, policymakers may have little choice but to embrace unconventional debt monetisation strategies. Allowing interest rates to climb naturally could be too damaging, potentially forcing a return to measures like Quantitative Easing or yield curve control. Using crypto as collateral may seem extreme today, but so too did Quantitative Easing and Reverse Repo before they became accepted market practices—both trends Hunt identified early. Is this a necessary financial innovation, or are we heading toward another speculative bubble? Hear Andrew Hunt and Jonathan Ramsay break it down: https://lnkd.in/gxkYhhDr 

We’re excited to welcome Tim Binsted as our new Head of Australian Equities. Tim brings a wealth of experience in investment management, most recently as Co-Portfolio Manager at NovaPort Capital, where he led stock selection and portfolio positioning. His background also includes time as an investment analyst at Adam Smith Asset Management, covering ASX-listed businesses across multiple sectors. Before moving into funds management, Tim was a journalist at the Australian Financial Review, giving him a unique perspective on how markets, businesses, and the economy interact. Director Fil Andronaco, CFA, comments “Tim joins us at an exciting time, and his depth of experience in Australian equities will only strengthen our research and investment decision-making. His expertise supports our commitment to delivering sharper stock selection and deeper insights for our clients. Please join us in welcoming Tim to the team! 

AI Evolution: What we discussed last week and what's happened in the last 6 days Last week we spoke with Tassos Stassopoulos, Managing Partner at Trinetra Investment Management, and Professor Marios Dikaiakos to discuss the rapidly moving landscape of AI after the DeepSeek launch and quick adoption. The discussion highlighted the democratisation of AI, open-source momentum, and hardware market shifts. Just 6 days later, real-world developments have validated these trends: • Democratisation of AI – India is accelerating its AI strategy, announcing plans to develop domestic LLMs within six to eight months using 18,693 GPUs. A ₹2,000 crore ($240M) budget has been allocated for AI infrastructure, including hosting DeepSeek on Indian servers. The goal? Cost-efficient, sovereign AI models. • Open-Source Adoption & The Commoditisation of LLMs – Enterprise players aren’t waiting. Microsoft, AWS, and Nvidia integrated DeepSeek-R1 into their cloud platforms within days of release. Increasingly, we’re seeing models become a commodity, where service providers can quickly switch to the next-best thing as the industry evolves. Interestingly, DeepSeek’s open-source license allows U.S. companies to host the model on U.S. servers, bypassing censorship restrictions. • Software Market Shifts – Software-driven companies that have been more focused on the near-term ROI (return on investment) of their AI investments, such as Amazon and especially IBM, outperformed those that have been pre-emptively ramping up AI infrastructure investment. The hardware manufacturers and energy plays have been the hardest hit. • Geopolitical AI Power Plays – Alibaba released Qwen 2.5-Max, claiming superiority over both DeepSeek and ChatGPT. Meanwhile, DeepSeek became the #1 free iOS app globally, overtaking ChatGPT in downloads. These rapid shifts reinforce what we discussed last week: AI’s future belongs to those who can adapt, innovate, and optimise for cost efficiency—not just those with the biggest budget and the most compute power. That’s just what happened in 6 days, the next 6 months could reshape the competitive landscape entirely. Listen to the conversation now: https://lnkd.in/gDSStGNB