The more interesting question is this: if confidence has returned, why are some investors becoming more cautious?
Rising markets often make investors feel safer. But when more and more of the market’s performance depends on a small number of companies, it’s worth asking whether risk is really falling – or simply becoming harder to see.
This question caught my attention while listening to a recent discussion between Akhil Patel and Tim Moffatt from Oakleigh.
They weren’t debating whether markets could move higher.
No, they were discussing something far more important: whether investors are paying enough attention to where we are in the real estate cycle.
Markets recover all the time. That’s nothing new.
What caught my attention was that Oakleigh’s response today is very different from its response during previous recoveries.
The rally may look familiar. Oakleigh’s reaction to it most certainly is not.
Back in late 2023, Oakleigh moved quickly to take advantage of opportunities created by market weakness.
Today, despite another strong rebound, they are taking a more cautious approach.
Why?
Because they believe where we are today matters.
Readers familiar with our work on the 18.6-year Real Estate Cycle will recognise this idea.
A rally early in a cycle is not the same as a rally later in a cycle. The headlines may look identical. The risks may not. That’s a point many investors miss.
Markets don’t become less risky simply because prices move higher. Sometimes rising prices are precisely what convinces investors to stop worrying about risk altogether.
Rising markets can make us feel safer. Yet some of the strongest market gains often occur during the later stages of a cycle, when confidence is growing, and investors are becoming increasingly comfortable taking on risk.
That’s why understanding context matters.
Not because it predicts every market move, but because it helps explain why two market rallies that look similar on the surface may deserve a very different response from you.
In Oakleigh’s latest market update, PSE co-director Akhil Patel and Oakleigh Investment manager Tim Moffatt explain how this view is shaping their current thinking.
They discuss why capital preservation has become increasingly important, why they remain selective when assessing opportunities, and which areas of the market they are watching most closely.
You may agree or disagree with their conclusions. That’s entirely your choice.
The value comes from understanding the thinking behind them.
Especially at a time when so much financial commentary is focused on the next headline rather than the bigger picture.
If you’d like to hear Akhil and Tim’s latest thoughts on markets, risk, and opportunity, click on the embedded link below to watch their latest market update at your leisure.
