Outlook 2026: Jitzes Noorman (Columbia Threadneedle Investments)

December 22, 2025

Outlook

Jitzes Noorman (credits Cor Salverius Fotografie)

^{This text was originally written in Dutch. This is an English translation.}

By Jitzes Noorman, Delegated Chief Information Officer and Investment Strategist, Columbia Threadneedle Investments

Where are the biggest opportunities and threats for 2026?

'First of all, alternative asset classes such as commodities and catastrophe bonds continue to score well in our Capital Market Assumptions (CMA) model this year. Commodities mainly because of their high expected returns, catastrophe bonds because of their combination of attractive returns and low risk.

Furthermore, for both equities and high-yield bonds, the categories linked to emerging markets score better than those linked to developed markets in terms of risk-return ratio. This reflects, among other things, the strong performance of assets in developed markets in recent years, which has led to less attractive valuations and, looking ahead, slightly lower expected returns. The arguments in favour of the attractiveness of equities in emerging markets are the higher economic growth expectations and lower valuations. Another factor is that the correlation between equities in emerging markets and equities in developed markets is currently relatively low, which contributes to better portfolio diversification.

Within fixed income spread products, we consider EMD LC to be the most attractive. The expected return is higher than for high yield bonds, while the assumed volatility is lower.

There is no shortage of risks. These include ongoing geopolitical fragmentation, the unpredictability of Donald Trump's policies and a flaring trade war. Another concern is rising government debt, which, combined with higher interest rates in recent years, is putting pressure on the creditworthiness of governments such as the US and France. Finally, more and more investors are asking whether there is an “AI stock bubble”.'