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Hedge Clippings | 13 March 2026
"It never rains, but it pours" is an old phrase that comes to mind when considering markets and global politics at present. AI, which had been driving sections of the market (and the market as a whole) since it was launched in the form of ChatGPT in November 2022, has seemingly turned from being a positive, and now reflects many of the risks (disruption, employment, capex, energy). Market darlings, such as Aussie home grown Atlassian, are indicative as they announced layoffs of 1600 staff this week, and have seen their share price fall from a peak of US$483 in October 2021, to below $75 as of now. Meanwhile, to the end user, AI's benefits are being implemented into everyday business operations at an amazing pace. Closer to home, February's reporting season was one of the most volatile on record. Two thirds (66%) of funds' performance numbers have been received to date, with wild fluctuations thanks to an ASX reporting season which provided plenty of surprises - both to the upside and on the downside. Overall, the ASX 200 Total Return (TR) index rose 4.11%, while the ASX Small Ordinaries (TR) fell by 2.57%. In this environment, many active equity managers struggled, while others, (although only 10% outperformed the ASX 200 TR) produced some impressive numbers. For the month, returns ranged from -21% (digital) through to +13.29% (not surprisingly, a global gold fund, Argonaut) reflecting their respective underlying asset or market sector. Over 12 months that became even more pronounced, with returns ranging from -53% (digital again) through to +233% (gold and key minerals again). While these outliers were obviously driven by headwinds or tailwinds respectively, between the extremes, a combination of strategy, sector, peer group, and most importantly, old fashioned manager skill, determined the outcome. Of interest was the appearance in February's top performers of Japanese Equity funds (average 12.10%), and Infrastructure Funds (average February return of 7.73%), while Managed Futures (Winton +5.05% and ECCM +4.59%) also stood out, alongside the inevitable gold, precious metals, and resources funds. Meanwhile the world suffers financial upheaval. If the rotation out of tech in the US, along with February's reporting season, weren't enough to throw markets into a turmoil, the US and Israeli attack on Iran completed the perfect storm. Somehow ("I'll end all wars") Trump seemed to think US arms and firepower would quickly bring the Iranian regime, and its 90 million + inhabitants to their knees begging forgiveness. He is obviously not a student of history when it comes to US overseas military endeavours, including Vietnam, Iraq, and Afghanistan, all of which (for the US at least) ended badly. This one is yet to play out, but whatever Trump claims, "quick" and "victory" seem a while away. Closer to home. We had the pleasure of interviewing George Bory from Allspring this week, a US$485 billion manager of Global Income funds and strategies being distributed in Australia by the team at Bennelong Funds Management. We managed to cover not only Allspring's and George's approach to bond investing - "Manage risk, rather than avoid it" - through to the current situation in the Middle East and its potential economic outcome, and finally the outlook for the US given the mid term elections which may or may not clip Trump's wings somewhat. You can see the full video here, or view the individual sections. Next week there's an RBA board meeting on Monday and Tuesday. As if things weren't complex and difficult enough already! We'll be joined as usual by our resident experts Nick Chaplin from Seed Funds Management and Renny Ellis from Arculus, to preview what they think the RBA is likely to do, and what they should do - which of course might be completely different. News | Insights Manager Insights | Allspring Global Investments Ben McVicar discusses the data centre effect | Magellan Investment Partners February 2026 Performance News Bennelong Concentrated Australian Equities Fund |
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