Today’s environment is one where inflation-sensitive assets are quietly outperforming beneath the surface. While investors remain obsessed with AI and the Magnificent Seven, real assets have become some of the best-performing areas of the market in the past 6 years. Commodities, natural resources, and inflation sensitive equities are significantly outperforming broader markets year-to-date.
Importantly, this does not mean technology stocks must collapse. In fact, secular growth and AI beneficiaries can continue performing well. But investors are making a critical mistake by building portfolios as though inflation and rates no longer matter.
Investors should not position exclusively for a 1999-style speculative boom. They should prepare for a world where inflation remains structurally higher, rates stay elevated longer than expected, and leadership broadens beyond a narrow group of technology companies.
The winners of the next decade may not simply be the fastest-growing software companies. They may also include energy, commodities, industrials, infrastructure, and real assets that benefit from persistent inflation and supply-side constraints. History rarely repeats perfectly. But it often rhymes. And right now, the market sounds a lot more like 1970s than the late 1990s.
This week, Astoria’s John Davi was interviewed by the CNBC where he talked about sticky inflation and portfolio construction. Watch the interview here:
Originally posted on Astoria Advisors
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