Insights 2026 | View on Absolute Return

In Insights 2026, we note that Absolute Return strategies benefited from strong macro dispersion in 2025, creating attractive conditions for active trading. While discretionary managers performed well, systematic models faced a more challenging start before recovering as markets stabilised. The use of Separately Managed Accounts (SMAs) continued to grow, offering more transparency and control for investors. Our focus remains on blending diversified sources of alpha and partnering with managers who can deliver consistent, market-independent returns.

Key Takeaways

• Active trading benefitted from shifting rates, tariffs and uneven global growth.
• Systematic strategies recovered after early-year weakness and remain useful diversifiers.
• SMA adoption is rising as investors seek greater transparency and flexibility.
• We are prioritising discretionary macro, quantitative equity market neutral and improved tail-risk protection for 2026.