![\"John](\"https:\/\/www.newsbeep.com\/nz\/wp-content\/uploads\/2025\/12\/https:\/\/d1e00ek4ebabms.cloudfront.net\/production\/453137a3-c82a-4dbb-9461-500577dee4b9.jpg\")
John Normand said the leverage being used to fund AI investment was increasing \u2018very rapidly\u2019 \u00a9 AustralianSuper<\/p>\n
Across its portfolio, AustralianSuper<\/a> at present has its largest overweight position relative to the index in international equities, at 3 percentage points higher than its benchmark allocation.\u00a0<\/p>\n Normand said he did not think AI-linked stocks were yet in a bubble, but since October he had been diversifying the fund\u2019s overseas equity allocation by adding more exposure to listed infrastructure companies. <\/p>\n AustralianSuper is not alone in its caution on AI. A number of <\/a>UK pension funds are cutting back their exposure<\/a> to US equities, amid concerns over the market\u2019s growing concentration in a small number of megacap tech stocks and the risk of a bubble. Schemes have been shifting allocations to other geographic regions or adding protection against falling stock prices.<\/p>\n John Graham, chief executive of Canada\u2019s largest pension fund CPPIB, told the FT this month that he was \u201cworried about the concentration risk\u201d in US equity markets and was \u201cknowingly underweight\u201d AI in the C$777.5bn (US$563bn) fund\u2019s allocation to American assets. <\/p>\n Looking ahead to 2026, Normand said he expected to add more exposure to private equity, which has suffered from a lack of funding in recent years after a rapid rise in interest rates hampered dealmaking and lowered the distributions paid back to investors, prompting many to pull back from the sector.\u00a0<\/p>\n \u201cI think next year will be the year where by the end of 2026 PE [private equity] will deliver more than public equities and that\u2019ll be a big change,\u201d he said.\u00a0Private equity groups raised just $592bn in the 12 months to June, their lowest tally for seven years, according to data from Preqin. <\/p>\n Normand also thinks there is an \u201cunderlying vulnerability\u201d in bond markets, because investors are at present only pricing in one quarter percentage point interest rate increase for the Fed in 2027, whereas history suggests the central bank normally lifts rates by more than that in the year after an easing cycle.\u00a0<\/p>\n \u201cWhen that repricing occurs it would tend to impact expensive assets the most,\u201d Normand said.<\/p>\n He added that the expensive assets \u201ctend to be centred around tech sector and AI theme \u2014 it doesn\u2019t mean this is the end of the story, it just means we have to be mindful of the risks that we manage\u201d.<\/p>\n","protected":false},"excerpt":{"rendered":"Stay informed with free updates Simply sign up to the US equities myFT Digest — delivered directly to…\n","protected":false},"author":2,"featured_media":193351,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[138,246,111,139,69,244,245],"class_list":{"0":"post-193350","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-business","9":"tag-finance","10":"tag-new-zealand","11":"tag-newzealand","12":"tag-nz","13":"tag-personal-finance","14":"tag-personalfinance"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/193350","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=193350"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/193350\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/193351"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=193350"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=193350"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=193350"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"Line](\"https:\/\/www.newsbeep.com\/nz\/wp-content\/uploads\/2025\/12\/https:\/\/d6c748xw2pzm8.cloudfront.net\/prod\/59cdc380-dcd4-11f0-a2fc-3db0e714e603-standard.png\")
<\/p>\n