Many prominent asset managers and research firms have released their 2026 market outlooks. What do they tell us about the future of the economy and investing?
Economic Growth
These outlooks are not predictions or guarantees. They rely on assumptions that can change quickly, and history shows that they are often wrong.
Several firms, including WisdomTree, BondBloxx, and Aberdeen, suggest that economic fundamentals entering 2026 appear relatively resilient. Expectations generally center on continued, though slower, growth, supported by fiscal spending, infrastructure investment, and steady consumer demand. BondBloxx, for example, estimates US growth around 1.5–2.0%.
That said, economic forecasts are inherently unreliable. Growth expectations can shift rapidly due to policy changes, financial stress, or geopolitical events. What looks like stability today can quickly turn into weakness, reinforcing that these views are probabilities.
Monetary Policy and Inflation
Across outlooks, there is broad agreement that the Federal Reserve is likely to remain cautious and data-driven. WisdomTree and BondBloxx expect any rate cuts to be gradual, reflecting persistent inflation pressures and uncertainty around labor markets and trade policy.
Still, inflation remains one of the largest unknowns. Tariffs, CPI, and wages could keep inflation above the Fed’s target longer than expected, or cool faster than anticipated. As RenMac emphasizes, real-time data and policy risk matter far more than static forecasts. Any projected path for interest rates should be viewed as highly tentative and subject to error.
Equities
Strong earnings growth continues to support equity markets, particularly in the US, according to Global X. However, WisdomTree and others note that valuations in parts of the mega-cap growth universe appear stretched. This creates the possibility, not the certainty, of rotation toward Quality, Value, Small Caps, and non-U.S. equities.
Emerging markets had a great year in 2025, and strong performance may continue if the US dollar stabilizes or weakens, while greater dispersion across stocks and sectors may create opportunities for active managers. Still, rotations rarely follow predictable timelines, and higher valuations increase the risk of disappointment if growth slows.
AI and Structural Themes
Artificial intelligence remains a dominant long-term theme across nearly all outlooks. Global X highlights that AI investment is expanding beyond mega-cap technology into infrastructure, energy, and industrial applications. At the same time, Man Group frames AI as one of several structural forces reshaping markets.
However, long-term themes do not eliminate short-term risk. Even transformational technologies can experience periods of overvaluation and underperformance. AI’s long-term potential does not guarantee near-term results.
Real Assets, Alternatives, and Diversification
Aberdeen and Global X emphasize infrastructure, commodities, and other real assets as potential beneficiaries of fiscal spending, inflation risk, and policy uncertainty. Alternatives are viewed as potentially resilient sources of returns in a more volatile environment.
These strategies come with trade-offs, including complexity and illiquidity. While diversification does not guarantee profits or prevent losses, many firms agree that it remains essential when outcomes are uncertain.
Key Takeaways
Across firms, several themes broadly emerge:
- Growth is expected to continue, but with higher volatility
- Fixed income may play a larger role in portfolios
- Equity dispersion may create opportunities for style rotations
- AI remains a powerful long-term theme with valuation risks
Above all, these outlooks should not be mistaken for predictions. They are educated guesses that can be, and often are, wrong. Successful investing depends less on forecasting the future and more on diversification, risk management, and the flexibility to adapt as reality diverges from expectations.
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The material has been gathered from sources believed to be reliable, however Bedel Financial Consulting, Inc. cannot guarantee the accuracy or completeness of such information, and certain information presented here may have been condensed or summarized from its original source. To determine which investments or planning strategies may be appropriate for you, consult your financial advisor or other industry professional prior to investing or implementing a planning strategy. This article is not intended to provide investment, tax or legal advice, and nothing contained in these materials should be taken as such. Investment Advisory services are offered through Bedel Financial Consulting, Inc. Advisory services are only offered where Bedel Financial Consulting, Inc. and its representatives are properly licensed or exempt from licensure. No advice may be rendered unless a client agreement is in place.
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