Dominic Kohler, Head of Investment and Client Solutions at Brown Shipley, Quintet Private Bank, reflects the resilience of traditional assets, stocks and bonds amid inflation, volatility and investor expectations.
Characterized by rapid macroeconomic changes, traditional asset classes such as stocks and bonds have been tested like never before. According to Kohler, the investment environment is one of the complexities and opportunities where prudence, adaptability and trust are more valuable than ever.
“We have navigated challenging environments over the past few years,” Kohler notes. “High interest rates, sustained inflationary pressures, volatile markets, and continued geopolitical uncertainty” have shaped how traditional assets are perceived and deployed.
For stocks, Kohler emphasizes that “being more selective, quality and resilience are more important than ever.” The outlook has brightened up on the bonds. “Things are looking up again so that yields become more appealing.”
This combination of careful optimism and tactical flexibility highlights Brown Shipley’s broader approach. “It’s a market where careful positioning is important. We are looking for opportunities for them to present themselves, with a long-term focus.”
Despite inflation showing signs of cooling, Kohler argues that maintaining wealth remains a core priority, especially for private clients seeking long-term stability.
“Apart from recapitalization, our investment philosophy also focuses on wealth protection,” he explains. “Even if inflation starts to become easier, this is key. Quality share and government or corporate bonds remain reliable tools to help bring philosophy to life.”
While new asset classes and financial innovations continue to emerge, Kohler believes in the continued importance of traditional investments. “We believe that traditional assets continue to play a key role despite changing market conditions, new asset classes and product innovations.”
Brown Shipley adopts a flexible yet disciplined approach to asset allocation, ensuring that it can respond quickly to market development without losing sight of its long-term goals.
“There’s a dynamic asset allocation approach,” Kohler explains. “We will actively adjust our positioning as the market changes. We will always be guided by a long-term outlook, but we will respond to short-term changes.”
During periods of increasing volatility, this may include reducing exposure to risky assets such as stocks and increasing allocations to high-quality bonds. “Within the stock, we are leaning towards sectors and businesses that are suitable for weather uncertainty,” he adds. “With bonds, yields are more attractive, making them an effective tool for not only saving capital but also generating income.”
While traditional assets form the core of most portfolios, Kohler emphasizes the increasing relevance of alternatives in achieving true diversification.
“It’s all about finding the right mix,” he says. “Alternatives will help reduce risk, increase diversification and provide illiquidity premiums.” In particular, the private market has gained traction, particularly among younger, more growth-oriented investors.
However, Kohler offers a word of caution. “The private market is complex and often well understood. Therefore, clear communication, profit positioning and risk are important.”
Despite the rise in alternatives and digital investments, Kohler is confident in the long-term performance potential of traditional assets.
“We focus on delivering consistent, risk-adjusted returns over the long term,” he says. “Traditional assets still have a strong role to play, and can provide stability and consistency, especially when clients see uncertainty and risk in the market.”
Furthermore, risk management is central to Brownshipley’s investment philosophy. Through parent company Quintet, banks can partner with BlackRock to access cutting-edge risk assessment tools.
“As part of our partnership with BlackRock, we will use best-in-class risk management tools to stress-test our portfolios and explore a variety of market scenarios,” explains Kohler. But numbers alone aren’t enough. “It’s important for advisors to approach clients and understand what’s most important to them. It’s important to spend time with them and ensure that their strategies remain in line with their investment goals and personal circumstances.”
If geopolitical developments can move the market overnight, Kohler’s advice is to maintain a level head.
“Whether it’s an election, a dispute, or a tariff announcement, we’ll look at how such events will affect the market and we may adjust our portfolio as needed,” he says. “But as we saw earlier this year, it’s key to rule out noise. Looking for opportunities is important, but sometimes sticking to our positioning is what makes it a great move in the long run.”
Kohler sees some power to reshape the future of traditional investment from regulatory changes and product innovations to expectations of young investors.
“We are in the midst of the biggest transfer of wealth in history,” he says. “Young investors focus on themes and sustainable investments. They continue to offer products accordingly, offering clients more options when it comes to wealth management and investment.”
Environmental, social and governance (ESG) considerations are increasingly at the forefront and centre. However, Brownshipley’s approach is personalized rather than normative.
“ESG is often about deeply held beliefs that reflect the individual values of the families we serve,” explains Kohler. “That’s why we don’t value, but rather offer our clients a wide range of options so we can invest in reconciliation with their values.”
He also states that incorporating ESG is a healthy investment issue. “Investors are constantly trying to limit the investment universe by excluding companies that are inadequately operated or excessively risky. Incorporating ESG metrics is an attempt to assess risk, avoid opportunities and identify opportunities based on factors that are always relevant to past investment decisions.”
While relationships are at the heart of client services, technology plays an increasingly important role in portfolio construction and management.
“Technology helps make more informed decisions faster,” says Kohler. “We have many key partnerships that have given us access to market-leading technologies that our clients benefit when supplying our internal processes and decision-making.” Still, he adds, “human interaction and judgment remain essential.”
Traditional assets continue to provide a solid foundation for wealth conservation and growth.
In Brown Shipley, not only does it choose the right stocks and bonds, it also builds long-term trust, responsibly leverages innovation, and remains pinned to what is most important to its clients.
As Kohler states, “With proper allocation and solid equipment choices, traditional assets can continue to offer excellent long-term returns.”
“Permanent Value: Traditional Assets with Modern Strategies” was originally created and published Private Bunker Internationala brand owned by GlobalData.
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