"You can make money in other markets too": 3 key takeaways from the J.P.Morgan summit

At the J.P.Morgan Asset Management 2026 Asia Pacific Summit, the theme is one that will be very familiar to Livewire readers: extracting signal from noise.

As JPMAM’s CEO for Singapore, Southeast Asia and India Ayaz Ebrahim puts it, “markets continue to be challenging. But they’re always challenging.”

And the ongoing challenge for investors is navigating the ever-increasing number of signals from the ever-growing noise.

“The world is moving really fast and it’s not slowing down," as JPMAM APAC CEO Dan Watkins put it.

And nowhere is that more true than Asia-Pacific, where long-developing structural trends and fast-moving emergent trends have put it at the forefront of global markets in a way it arguably hasn't been before. It is "undoubtedly a growth story", said Watkins.

Against that backdrop, here are some of the major themes JPMorgan is putting front of mind.

Diversification is the theme for equities

According to Paul Quinsee, JPMAM CIO and Head of Global Equities, there's one lens through which investors should be viewing their stock allocations going forward. 

"The right theme as you're thinking about investing in equities next year is diversification," he said. 

That naturally means finding opportunities outside the all-conquering AI trade, even if it remains too big to ignore. 

"There's no question earnings are turbocharged by the AI buildout," he said. "Roughly two-thirds of the earnings growth this quarter is coming from semiconductors."

"But there are still opportunities to make money that are not as tied to the AI theme."

But Quinsee suggests an even broader approach to diversification beyond simply counter-balancing AI exposure.

"It's really important investors diversify by style and by geography," he said. One example is value investing, which has rewarded investors in Europe and Asia and is also doing so in the US.

On geographical diversification, he says Japan and ASEAN are two notable places to look for investors who have spent the last 15 years continue to raise their allocation to the US.

But the overriding message is that for investors who find themselves over-exposed to AI, or I would argue is also the case for Australian investors with banks and miners, is be open to the plethora of opportunities outside the familiar stomping grounds. 

"You can make money in other markets, too.”

AI is not a bubble

It says something about where the AI sector currently finds itself that a session titled "The Devil’s Advocate on AI" could feasibly be taking either side of the argument.

But at the JPMAM summit, the case made by Oliver Cox, Emerging Markets & Asia Pacific Equities Portfolio Manager, and Jason Yum, US Equity Research Analyst and Portfolio Manager, was a positive one. 

Whether it's the risks of AI capex overspending, the threat of Chinese AI models or the biggest concern of all - is AI a bubble? - the view here is highly constructive.

And that view is driven by the numbers. Hyperscaler operating cash flows are on track to grow 3x, even if their AI capex spending has seen free cash flow dip into the negative.

Frontier AI companies have managed to monetise at a 4x higher rate than cloud infrastructure, suggesting there's a clear pathway to strong return on investment numbers. 

And in Asia, record cashflow generation means some of the key Japanese and Korean AI names will be locking in record dividends and stock buybacks, even as the market is pricing them at valuations that suggest the party could end soon.

Even the outlook for software companies - one of the clearest casualties of the AI revolution so far - is a positive one. The opportunity for them has moved from a US$1 trillion one to a US$4 trillion one, says Cox, as the workflow automation sector grows. 

By its very nature, AI is a noisy trade, but finding the signal is simply a matter of understanding it's here to stay and navigating that opportunity appropriately. 

"Focus on the long term," said Cox. "We are believers in the stronger-for-longer capex cycle, but prepare for volatility."

As Jennifer Qiu, Investment Specialist - US Equity, put it: "AI is not one trade. The value chain is being recreated every day."

It's a new paradigm for alternatives

Charles Wu, Head of APAC Alternatives, says investors are now reassessing their relationship to the asset class. 

"Alternatives are going through a paradigm shift," he said. "20-30 years ago investors saw alternatives as really a satellite asset class."

These days, he says, investors now first define a role for alternatives, whether that's income, inflation protection or diversification, and then allocate accordingly. 

That's especially significant at a time when more popular asset classes are potentially failing to fulfil the roles they have done traditionally. 

According to the panel, the highest-conviction opportunities in alternatives are regulated utilities in the US on the infrastructure side, US real estate and the living thematic in Asia, specifically Japan's multi-family rental market.

But there's also the opportunity in private equity, which has become almost unavoidable for investors looking to make the most of the global opportunity set. 

"If you're only investing in public equity you're cutting off a huge proportion of the investible universe," said James Burdis, Head of Global Strategic Relationships and Private Wealth Alternatives, Asia Pacific. 

He says private markets could become a core asset class over the next five years, and that is emblematic of the sentiment shift we're seeing towards alternatives as a whole. 

"Ultimately," said Burdis, "the question will be 'can we have a version of alts in a traditional multi-asset portfolio?'"

"Alts can deliver on so many fronts."