IFAs: Which asset class will perform best in 2026 in your view?

With global uncertainty showing no signs of calming, gold will be the master-hedge in 2026. However, with interest rates across the world dropping, with the exception of Japan, equity prices are also likely to rise. Finding clever plays like the AI sector by investing in Korea, could prove a winning hand.

When predicting asset class returns, the smart play is almost always equities. Over the long term, they have been the best-performing asset class, so statistically you’re more often right than wrong.

Looking more specifically at regional opportunities, despite our domestic economic challenges, the UK equity market looks very attractive relative to the US and many other developed markets. Valuations remain low, sentiment is poor, and that combination is increasingly drawing interest from overseas investors and fund managers.

That renewed interest alone could be enough to trigger a re-rating of the UK market, which in turn could make 2026 a very strong year for UK equities.

Areas I’d be more cautious on are those that have performed exceptionally well in recent years. Precious metals such as gold and silver are riding high but might therefore fall back a little. Also, US mega tech stocks, which have delivered stellar returns, surely can't defy gravity forever.