DBS urges portfolio rebalancing as volatility rises

Investors should avoid excessive exposure to any single market or asset class.

DBS Bank Ltd. is urging investors to rebalance portfolios and diversify across asset classes as it steps up advisory support amid heightened market volatility.

The bank’s second-quarter investment outlook released in March cited the need to build resilience through broader regional exposure, defensive assets such as gold, and alternative strategies including hedge funds.

“Investors are navigating an environment shaped by geopolitical tensions, policy shifts, and rapid technological change,” Chief Investment Officer Hou Wey Fook told Asian Banking & Finance. “In such conditions, resilience in portfolio construction becomes essential.”

DBS said portfolios should avoid heavy concentration in a single market or asset class, instead adopting a more balanced allocation to capture opportunities across regions.

“Markets tend to reward disciplined investors who maintain diversification,” Hou said in an emailed reply to questions. “Portfolios should be positioned to capture opportunities across global markets.”

Gold remains a core component of the bank’s strategy, serving as a hedge during periods of uncertainty.

“Gold continues to stand out as a reliable hedge,” Hou said, adding that it helps strengthen overall portfolio resilience.

Beyond traditional equities and bonds, DBS is also encouraging the use of hedge funds and other alternative strategies to navigate increasingly complex market conditions.

These approaches could help manage volatility whilst taking advantage of price differences across assets, the bank said.

The lender also flagged Asia as a key pillar of global portfolios, citing strong structural drivers such as technology investment and resilient economic growth.

“For long-term investors, the region offers compelling opportunities as global capital gradually diversifies,” Hou said.

The recommendations come as investors contend with persistent geopolitical risks and shifting monetary policy expectations, prompting a broader reassessment of portfolio strategies.