Core Viewpoint - The global market in 2026 is entering a critical chaotic phase, with increased correlation and sensitivity of asset prices, necessitating a shift from diversifying assets to diversifying paths in investment strategies [1][2][3] Economic Growth - The IMF projects global economic growth to slow to 3.1% in 2026, down 2 percentage points from 2024, while developed economies are expected to grow at 1.6% [2] - Emerging markets show significant divergence, with India and some Latin American countries maintaining stability, while most economies are more sensitive to external demand changes [2] Policy Environment - Global interest rates are expected to remain relatively high in 2025-2026, with the US policy rate projected to fall to 3.0-3.25% and the Eurozone around 2.15% [2] - The interaction between fiscal and monetary policies is becoming stronger due to high debt levels and interest rates, leading to quicker market reactions to policy signals [2] Market Structure - The applicability of traditional linear assumptions is declining, with inflation paths becoming less smooth and economic cycles no longer synchronized [2][3] - There is an increasing tendency for risk and non-risk assets to move in sync, indicating a rise in correlation among assets during this critical phase [2][3] Investment Strategy - The shift from asset diversification to path diversification is becoming essential, as traditional methods of risk mitigation through asset quantity are facing challenges [3][4] - Path diversification focuses on positioning across different risk factors, policy changes, and market narratives to maintain stability across various market scenarios [4] Asset Performance - The economic outlook for 2026 suggests a scenario of "low inflation, weak employment, and slowing but resilient growth," leading to clearer structural differentiation among asset classes [4][5] - US long-term yields are expected to fluctuate within the range of 3.9%-4.2%, while equity structures are showing increased differentiation, particularly in response to policy signals [4][5] Currency and Commodity Outlook - Gold is expected to remain strong due to policy uncertainty and central bank reserve demand, while the US dollar is likely to weaken, with the index projected to range between 95-100 [5] - Non-US currencies are anticipated to perform relatively better, with the euro benefiting from a weaker dollar and the Chinese yuan showing potential for moderate strengthening due to stable policies and domestic demand recovery [5]