5 investing lessons from Soul Patts CEO Todd Barlow - and the result that followed

Please note: This interview was filmed on 22 September 2026.

Timing can be a wonderful thing.

Two days before Soul Patts released its FY26 result, CEO Todd Barlow joined us on stage at Livewire Live 2026 to explain how one of Australia's oldest investment houses is positioning for a very different market environment.

Then came the numbers.

Soul Patts delivered a 10.2% pre-tax NAV return, compared with 6.0% for the ASX 200 Total Return Index, while net cash flow from investments increased 11.5% to $572 million.

Investors liked what they saw, sending the shares more than 6% higher towards $50.

And Soul Patts kept one of the more remarkable streaks on the ASX alive. Its final dividend increased 6.8% to 63 cents per share, completing 28 consecutive financial years of dividend growth.

But for investors wanting to understand how Soul Patts got here – and where Barlow wants to take it next – his Livewire Live conversation provided plenty of clues.

Here are five moments that stood out to me.

1. Intentionality is an investing skill

Perhaps the biggest lesson from Barlow's presentation was that Soul Patts' evolution has been deliberate.

Five years ago, listed equities represented roughly 90% of the portfolio. Today, they're closer to 40%. Barlow encourages his team to engage in a “contest of ideas” and remain “hungry” for the best sources of return, regardless of asset class.

That wasn't portfolio drift. Soul Patts made a conscious decision to reduce its dependence on one asset class and build more diversified sources of return. 

“In the last five years, we have felt that it is appropriate to de-risk an equity-centric portfolio into one that is more multi-asset.”

Barlow also explained:

“There's also been a desire for us to get more uncorrelated returns.”

The ultimate goal is what Barlow describes as the “holy grail” of portfolio construction: protecting capital on the downside while still participating strongly when markets rise.

And the data shows this approach is doing its job. Soul Patts calculates that over the past 25 years, when the ASX 200 has fallen in a month, Soul Patts has declined 1.4% on average versus 3.2% for the index.

The lesson: long-term investing doesn't mean building a portfolio and refusing to touch it. Markets change, valuations change and the returns available from different assets change. Your portfolio can change with them.

2. Sometimes cash is the investment

Investors often treat cash as money waiting to be put to work. Barlow's point was that, with risk-free rates where they are today, holding cash can itself be an active investment decision.

Soul Patts has around 20% of its portfolio in cash and liquid investments, and Barlow stressed this isn't a “parking spot”.

“We've got a big cash allocation, which is not a parking spot. It's a deliberate allocation to take risk off and to have that liquidity there for opportunities that might present themselves if there is dislocation.”

The FY26 result reinforced the point. Soul Patts ended the year with $2.7 billion in net cash and liquid investments, with capital awaiting deployment tactically allocated to fixed income so it can earn a return while retaining flexibility.

The lesson: cash doesn't always represent indecision. When you're being adequately paid to wait, it can earn its place in a portfolio.

3. You don't have to catch every winner

Even great investors miss great investments.

Barlow readily acknowledged that Soul Patts largely missed one of the defining trades of recent years: the extraordinary rise of US technology stocks.

“That's not to say that we don't believe in it, it's just not something that we're good at.”

Rather than suddenly chasing technology, Soul Patts has stuck to areas where it believes it possesses an edge, while using overseas managers to access opportunities outside its circle of competence.

The lesson: it's perfectly human to miss the boat. Successful investing doesn't require owning everything that goes up.

4. Know where you have an edge - and where you don't

Soul Patts' approach to private credit provides a neat example.

Barlow said the portfolio has generated returns of around 14% per annum over the past four to five years. Yet it has zero exposure to property development lending, despite that being one of the biggest areas of Australia's private credit market.

“It's a crowded space. We don't think we've got an edge there.”

Instead, Soul Patts targets more bespoke opportunities where companies need capital but can't – or don't want to – access traditional bank or equity financing.

The lesson: an attractive asset class isn't necessarily an attractive investment for you. Knowing where you don't have an advantage can be just as valuable as knowing where you do.

5. Your biggest decision might not be which stock to buy

This was one of my favourite moments from the audience Q&A.

Investors spend enormous amounts of time asking which company they should buy next. Barlow argued that the decisions sitting above stock selection can have a much greater influence on outcomes.

“Asset selection – what to invest in, where to invest, when to invest – are all much more meaningful decisions to your overall outcomes than stock selection.”

The lesson: before asking which stock to buy, it may be worth asking a bigger question: which asset class should you be invested in?

Watch the full interview

From why cash is making a comeback to private credit, portfolio construction and the opportunities Soul Patts is hunting today, Barlow covered plenty more during his Livewire Live 2026 appearance.

Watch the full conversation with Livewire Markets Co-Founder and Executive Chairman James Marlay  below.