Category: Nomad Investor

In 2026, the race to power artificial intelligence (AI) systems and data centres is shifting from processing chips to the availability of electricity itself. With global data centre power demand projected to rise by a staggering 17% this year, energy constraints are becoming a choke point for the tech sector’s growth. For Australian investors, this shift presents a critical question: how do we navigate the opportunities and risks in the emerging “Powering AI” ecosystem?

The answer may lie in a nuclear renaissance. As renewable energy sources like solar and wind strain under intermittency issues, small modular reactors (SMRs) and grid-scale battery storage are gaining traction. These technologies promise not only carbon-neutral power but also the reliability needed to meet the energy-intensive demands of AI. With power prices already a political flashpoint in Australia and beyond, understanding the forces reshaping energy markets is essential for positioning portfolios in 2026 and beyond.

What’s Happening

Energy availability has emerged as the primary bottleneck for global tech expansion. Over the past five years, AI workloads have grown exponentially, driving demand for hyper-scale data centres. These facilities consume enormous amounts of power, often equivalent to small cities. According to the International Energy Agency (IEA), data centres and data transmission networks now account for nearly 3% of global electricity consumption, up from 1% in 2010.

In response, the private sector is turning to innovative solutions like small modular reactors (SMRs), which are compact, factory-assembled nuclear reactors designed for decentralised energy generation. The US Department of Energy predicts that SMRs will begin commercial deployment by 2030, with some prototypes already operational. Meanwhile, investments in grid-scale battery storage are set to reach USD 20 billion globally in 2026, according to BloombergNEF.

Australia is uniquely positioned in this energy transformation. The country’s natural resources make it a key player in the production of critical minerals like lithium and uranium, both of which are essential for batteries and nuclear energy. However, domestic power prices—already among the highest in the developed world—pose a challenge. As tech giants like Google, Amazon, and Meta seek carbon-neutral energy solutions, companies that can deliver reliable, off-grid power are emerging as crucial partners.

The Data Behind the Story

The numbers tell a compelling story about the scale and urgency of this transition:

What This Means for Investors

For investors, the “Powering AI” trend opens opportunities across several asset classes:

• Energy Infrastructure: Companies specialising in SMRs, battery storage, and microgrids are poised for significant growth. ASX-listed firms like Origin Energy and AGL Energy are already exploring grid-scale storage projects.
• Critical Minerals: Lithium and uranium producers stand to benefit from the rising demand for batteries and nuclear fuel. Keep an eye on companies like Pilbara Minerals and Paladin Energy.
• Real Estate: Data centre REITs, particularly those investing in facilities with dedicated energy solutions, could see increased demand from tech companies.
• Green Bonds: As governments and corporations fund renewable and nuclear projects, green bonds offer a route to participate in this transition.

Key Risks to Watch

While the opportunities are compelling, there are risks investors must consider:

• Regulatory Hurdles: Nuclear projects face lengthy approval processes and public opposition, which could delay deployments.
• Technological Uncertainty: New energy technologies like SMRs and advanced batteries are unproven at scale, posing execution risks.
• Geopolitical Tensions: Australia’s uranium exports may face barriers due to global instability or protectionist policies.
• Energy Price Volatility: While high energy prices benefit producers, they could harm broader economic growth, affecting equity markets.

Nomad Investor Takeaways

• Global data centre power demand is driving a critical shift in energy infrastructure investment.
• Small modular reactors (SMRs) and grid-scale battery storage are key technologies to watch.
• Australian investors can leverage the country’s position in uranium and lithium production.
• Energy infrastructure firms and green bonds are attractive options for diversifying portfolios.
• Be aware of regulatory and technological risks when investing in emerging energy solutions.
• Focus on companies with clear paths to profitability and proven execution capabilities.
• Keep an eye on geopolitical developments that could impact critical mineral exports.

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Paul Ingersole

Nomad Investor

Global investing and wealth-building insights for the location-independent entrepreneur.

In 2026, the investment landscape around artificial intelligence has shifted dramatically. The days when companies could see their stock prices soar simply by dropping the term “AI” in earnings calls are long gone. Investors are no longer swayed by hype; instead, they are laser-focused on measurable outcomes. Enter Agentic AI—autonomous systems with the ability to execute complex tasks like settling trades, optimising supply chains, and managing compliance without constant human intervention. This next phase of AI integration is reshaping industries, with traditional sectors such as banking, logistics, and healthcare emerging as the unexpected winners. For Australian investors, the focus is now on identifying “Secondary Beneficiaries”—companies leveraging these systems to achieve tangible operational efficiencies and significant margin expansion.

This paradigm shift matters because it’s not just about tech companies anymore. It’s about how established industries are adopting and deploying Agentic AI to unlock value. Early data shows that businesses integrating these technologies are seeing their profit margins double, a trend no serious investor can afford to ignore. So, where do the opportunities lie, and how can investors navigate this new frontier?

What’s Happening

The conversation around artificial intelligence has matured. In the early 2020s, simply mentioning AI during an earnings call could drive a company’s stock price higher, even if its actual AI initiatives were vague or underdeveloped. But as the technology advanced, so did investor expectations. By 2026, the focus has shifted to Agentic AI—systems designed to operate independently, making decisions and executing tasks based on predefined objectives without requiring continuous human input.

This shift is particularly pronounced in sectors that are not traditionally associated with cutting-edge technology. In banking, for instance, Agentic AI systems are optimising loan approvals and fraud detection. In logistics, they are automating supply chain management and route optimisation. Meanwhile, in healthcare, these systems are improving patient outcomes by streamlining diagnostics and administrative workflows. Companies in these sectors are reporting up to a 2x increase in operating margins, thanks to the efficiency gains delivered by autonomous digital co-workers.

For Australian investors, this is especially relevant. The ASX is home to a mix of traditional and technology-driven companies, many of which are beginning to integrate Agentic AI into their operations. This creates a unique opportunity to invest in sectors where AI is driving real-world impact, rather than speculative growth.

The Data Behind the Story

The numbers tell a compelling story. According to a recent report by McKinsey, industries adopting Agentic AI are seeing a 20–30% reduction in operational costs within the first two years of implementation. In logistics, for example, companies using AI-driven supply chain systems reported a 35% improvement in delivery times and a 25% reduction in inventory holding costs.

Closer to home, Australian banks such as Commonwealth Bank and Westpac are investing heavily in AI-driven fraud detection systems, which have already reduced fraud-related losses by 15% year-on-year. Meanwhile, logistics giant Toll Group has integrated AI into its fleet management operations, achieving a 20% improvement in fuel efficiency.

What This Means for Investors

For investors, the rise of Agentic AI represents a seismic shift in portfolio strategy. The focus should now be on identifying companies within traditional sectors that are effectively deploying these systems to drive efficiency and profitability. These “Secondary Beneficiaries” offer a unique blend of stability and growth potential, making them attractive for both conservative and growth-oriented portfolios.

Australian equities, particularly in the ASX 200, provide fertile ground for such opportunities. Banks, logistics firms, and healthcare providers are leading the charge, with many already reporting measurable gains. Beyond equities, infrastructure funds and REITs with exposure to logistics hubs or healthcare facilities may also benefit indirectly from increased operational efficiency in these sectors.

Key Risks to Watch

While the opportunities are significant, they are not without risks. Here are the key challenges investors should monitor:

• Implementation Costs: Deploying Agentic AI systems requires substantial upfront investment, which can strain balance sheets in the short term.
• Regulatory Uncertainty: The increased autonomy of AI systems raises compliance and ethical concerns, particularly in heavily regulated industries like banking and healthcare.
• Cybersecurity Threats: Autonomous systems are attractive targets for cyberattacks, which could disrupt operations and erode trust.
• Market Saturation: As more companies adopt these technologies, the competitive advantage may diminish, putting pressure on margins.

Nomad Investor Takeaways

• Focus on “Secondary Beneficiaries” in traditional sectors like banking, logistics, and healthcare.
• Prioritise companies with a clear roadmap for AI-driven margin expansion.
• Monitor ASX-listed firms integrating Agentic AI solutions for measurable operational improvements.
• Consider thematic ETFs targeting AI adoption in traditional industries.
• Be cautious of companies with unsustainable debt levels funding their AI initiatives.
• Factor in regulatory and cybersecurity risks when evaluating potential investments.
• Stay informed on earnings reports to track AI’s impact on profitability and margins.

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Paul Ingersole

Nomad Investor

Global investing and wealth-building insights for the location-independent entrepreneur.

As global banking regulations tighten in 2026, corporate borrowers are finding fewer options within traditional finance. The result? A dramatic rise in private credit funds stepping in to fill the void. These funds, once considered a niche corner of alternative investments, are now a multi-trillion dollar powerhouse driving mid-market growth and infrastructure finance. This shift underscores the growing importance of Significant Risk Transfers (SRTs), where private funds absorb risk off bank loan books. For investors, the opportunity is clear: higher yields in exchange for embracing the role of modern-day shadow lenders.

But with opportunity comes complexity. Private credit is no longer the “alternative” it once was. It is a primary engine of capital allocation, and understanding its risks and rewards is crucial. For Australian investors, this trend offers both challenges and opportunities, especially as superannuation funds increasingly allocate to this burgeoning asset class. Let’s dive into the dynamics shaping this transformation and what it means for your portfolio.

What’s Happening

The global financial system is undergoing a profound structural shift. Stricter banking regulations, such as Basel IV, have made traditional bank lending more expensive and less flexible. This has pushed companies, particularly in the mid-market sector, to seek alternative funding sources. Enter private credit funds, which now manage an estimated USD $1.5 trillion in assets globally, according to Preqin.

Unlike traditional banks, private credit funds operate with fewer regulatory constraints, allowing them to offer customised lending solutions. This is particularly relevant for infrastructure projects, real estate developments, and leveraged buyouts. In Australia, the trend is gaining momentum, with superannuation funds and family offices increasingly allocating to private credit as they seek yield in a low-interest-rate environment.

Significant Risk Transfers (SRTs) are also becoming a central theme. Under these arrangements, banks offload portions of their loan books to private credit funds. This allows banks to free up capital while enabling private funds to earn higher yields by taking on the associated risks. For example, the European market alone saw over €120 billion in SRT transactions in 2023, and the trend is spilling over into Asia-Pacific markets, including Australia.

The Data Behind the Story

Private credit’s growth is staggering. In 2010, the global private credit market was valued at just USD $300 billion. Fast forward to 2026, and it’s projected to exceed USD $2 trillion, according to Deloitte. This represents a compound annual growth rate (CAGR) of roughly 15%—a pace that far outstrips most traditional asset classes.

In Australia, private credit has grown from a fringe investment to a key pillar of the institutional portfolio. A recent survey by the Australian Investment Council revealed that private credit allocations among superannuation funds have tripled since 2018, now accounting for more than 5% of total assets under management. This trend is expected to accelerate as funds seek alternatives to low-yielding government bonds and equities.

What This Means for Investors

For investors, private credit offers a compelling risk-reward profile. Yields in private credit typically range from 6% to 12%, significantly higher than government and investment-grade corporate bonds. Moreover, the asset class provides diversification benefits, as private credit returns are often uncorrelated with public equity markets.

Australian superannuation funds have been quick to capitalise on this trend. By allocating to private credit, these funds are not only boosting returns but also supporting domestic infrastructure projects. For example, private credit has played a pivotal role in financing renewable energy projects across regional Australia, aligning with ESG objectives.

However, this is not an asset class for the faint-hearted. Illiquidity, complex structures, and credit risk must all be carefully managed. Investors need to conduct rigorous due diligence, focusing on fund managers with a strong track record in underwriting and risk management.

Key Risks to Watch

While private credit presents lucrative opportunities, it is not without risks. Here are the key areas to monitor:

• Economic Downturns: Private credit is highly sensitive to economic cycles. A recession could lead to higher default rates, particularly in mid-market lending.
• Illiquidity: Unlike public bonds, private credit investments are not easily tradable. This can pose challenges for investors needing liquidity.
• Concentration Risk: Many private credit funds have sector or borrower concentration, amplifying risk during sector-specific downturns.
• Regulatory Changes: While currently less regulated, private credit could face increased scrutiny as its systemic importance grows.

Nomad Investor Takeaways

• Private credit is no longer niche—it is a USD $2 trillion asset class driving global growth.
• Yields of 6% to 12% make private credit an attractive alternative to traditional fixed income.
• Australian super funds are leading the charge, with allocations tripling since 2018.
• Significant Risk Transfers (SRTs) are reshaping how banks and private funds share risk.
• Illiquidity and economic sensitivity are key risks; due diligence is paramount.
• Private credit aligns well with ESG goals, particularly in infrastructure and renewable energy projects.
• Investors should prioritise experienced managers with a proven track record in risk management.

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Paul Ingersole

Nomad Investor

Global investing and wealth-building insights for the location-independent entrepreneur.

Artificial intelligence (AI) has moved from theoretical promise to widespread adoption, and its impact on the labour market is unmistakable. A stark “K-shaped” economic divide is emerging as AI reshapes industries and professions. High-income professionals—armed with AI tools—are amplifying their productivity and earnings potential, while lower-income roles face the brunt of displacement. For investors, this divergence reveals two critical opportunities at opposite ends of the spectrum: catering to the growing wealth of the AI-augmented class and investing in the reskilling industry that will help displaced workers transition into new roles.

As AI accelerates, the stakes are rising for workers, businesses, and investors alike. For forward-looking portfolios, understanding this dynamic is not just a matter of avoiding risk but also of capturing growth in industries fundamentally reshaped by AI. Whether through luxury goods targeting high-income professionals or education providers enabling workforce adaptation, this is an investment theme with profound implications.

What’s Happening

AI adoption is hitting critical mass, driving seismic shifts across industries. Tools like ChatGPT, DALL·E, and automation platforms are enabling professionals to achieve more in less time, boosting productivity and, in many cases, incomes. At the same time, roles heavily reliant on repetitive tasks—data entry, customer service, or basic manufacturing—are being automated. According to McKinsey, up to 25% of global work hours could be automated by 2030, with lower-wage jobs most at risk.

In Australia, sectors such as mining automation and healthcare AI are leading adoption. However, the Reserve Bank of Australia (RBA) has noted that displacement pressures could exacerbate income inequality, particularly for those in lower-income brackets who lack access to reskilling opportunities. Meanwhile, high-income professionals increasingly integrate AI into their workflows, driving demand for luxury goods, bespoke financial services, and tailored professional development programs.

The Data Behind the Story

Understanding the “K-shaped” economic divide requires a closer look at the data. On one hand, high-income professionals are seeing opportunities to amplify their earnings. For example, productivity enhancements from AI tools have reportedly increased output by 20–40% in sectors like law, finance, and engineering. On the other hand, industries with repetitive, routine tasks are shedding workers.

Australia’s labour market is already feeling the strain. A report from the Australian Bureau of Statistics (ABS) indicates that automation could displace up to 3 million workers by 2035. Concurrently, AI-driven industries are creating high-value roles, but these typically require advanced technical or interpersonal skills that displaced workers often lack. The reskilling industry—focused on human-centric skills like creative problem-solving and emotional intelligence—is projected to grow by 15% annually through 2030.

What This Means for Investors

The economic divergence driven by AI creates distinct opportunities for investors, particularly in alternative assets and hard money strategies. On one end, luxury goods and bespoke wealth management services are thriving as AI-augmented professionals increase their disposable income. Companies like Louis Vuitton and Ferrari are reporting record profits, buoyed by demand from high-income earners leveraging AI productivity gains.

On the other end, the reskilling industry is poised for significant growth. Platforms offering training in human-centric skills—such as creativity, ethical decision-making, and emotional intelligence—are attracting investment from venture capital firms and educational funds. For Australian investors, this translates to opportunities in ASX-listed education providers and global training platforms.

Key Risks to Watch

While the investment opportunities are compelling, several risks warrant attention:

• Regulatory uncertainty: Governments are grappling with how to regulate AI, which could impact adoption rates and corporate profitability.
• Displacement backlash: Social unrest or political pressure stemming from widespread job displacement could disrupt markets.
• Reskilling bottlenecks: The pace of workforce transition may be slower than anticipated, limiting the effectiveness of reskilling programs.
• Luxury market saturation: Over-reliance on high-income professionals could lead to market saturation in the luxury goods sector.

Nomad Investor Takeaways

• AI is driving a “K-shaped” economic divide, creating unique investment opportunities in luxury goods and the reskilling industry.
• Australian investors should monitor ASX-listed education providers and global luxury brands for growth potential.
• Automation is likely to displace up to 3 million Australian workers by 2035, underscoring the importance of reskilling programs.
• Luxury goods and bespoke financial services are thriving as high-income professionals leverage AI for productivity gains.
• Reskilling-focused ETFs and venture capital funds are attractive options for diversifying portfolios.
• Regulatory changes, workforce adaptation delays, and market saturation are key risks to account for.
• Positioning your portfolio early can help capture growth from industries reshaped by AI adoption.

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Paul Ingersole

Nomad Investor

Global investing and wealth-building insights for the location-independent entrepreneur.

The global economy is undergoing a profound transformation. The era of “just-in-time” efficiency, where global supply chains prioritised speed and cost, is being replaced by “just-in-case” resilience. This shift is driven by geopolitical tensions, supply chain disruptions, and national security concerns, particularly around critical technologies like semiconductors and rare earth minerals. Governments are increasingly prioritising control and localisation, giving rise to “Tech Localization”—the strategic push to build domestic champions in key industries shielded by subsidies and trade barriers.

For investors, this marks a significant departure from decades of globalisation. The fragmentation of trade between major blocs such as the U.S., China, and Europe is creating both challenges and opportunities. Countries rich in critical resources or positioned as neutral bridges in this fragmented landscape are emerging as focal points for “geopolitical alpha,” a new paradigm in investment strategy. Understanding these dynamics is key to navigating the era of localisation profitably.

What’s Happening

Over the last three years, geopolitical tensions have accelerated the shift towards economic localisation. The U.S. CHIPS Act, passed in 2022, earmarked $52 billion to incentivise domestic semiconductor manufacturing. Similarly, the European Union has committed over €43 billion to its own semiconductor strategy, aiming to double its global market share by 2030. China, meanwhile, has doubled down on its “Made in China 2025” plan, focusing on self-sufficiency in key sectors like artificial intelligence, electric vehicles, and advanced manufacturing.

Trade barriers and export controls are now commonplace. The U.S. has imposed significant restrictions on semiconductor exports to China, while the EU and Australia are leveraging their critical mineral reserves to strengthen domestic industries. Australia, for example, holds around 40% of the world’s lithium reserves—a key input for electric vehicle batteries—and is rapidly expanding processing capacity to capture more value domestically.

This shift is not purely economic; it’s a matter of national security. Governments are concerned about supply chain vulnerabilities, particularly in sectors critical to defence and digital infrastructure. The COVID-19 pandemic exposed how reliant nations had become on foreign suppliers for everything from medical equipment to microchips. Now, localisation strategies are aimed at reducing these risks, even if this comes at the cost of efficiency.

The Data Behind the Story

Statistics paint a clear picture of the localisation trend. According to the Semiconductor Industry Association, global semiconductor sales hit $573 billion in 2022, yet over 75% of manufacturing capacity is concentrated in East Asia. This dependency has prompted significant investments by Western nations to diversify production. For example, Taiwan Semiconductor Manufacturing Company (TSMC) is building a $12 billion plant in Arizona, supported by U.S. subsidies.

Critical minerals also highlight the shift. The International Energy Agency (IEA) estimates that demand for lithium, cobalt, and rare earth elements will grow by 400–600% by 2040 due to green energy transitions. Countries like Australia, Chile, and Canada are positioning themselves as key suppliers, but they are increasingly focused on domestic processing rather than raw exports.

Another trend is the rise of trade barriers. The World Trade Organisation (WTO) reported that as of mid-2023, over 1,000 trade-restrictive measures were in place globally, a 30% increase from 2020. These measures include tariffs, quotas, and export controls aimed at protecting domestic industries.

What This Means for Investors

The localisation trend has profound implications for portfolio strategy. Investors should consider tilting their portfolios towards domestic champions in key sectors such as semiconductors, green energy, defence, and critical minerals. These sectors are likely to benefit from government subsidies, favourable regulation, and trade barriers.

For Australian investors, the lithium and rare earth sectors are particularly compelling. Companies involved in mining, refining, and exporting these materials are positioned for strong growth, driven by demand for electric vehicles and renewable energy technologies. Additionally, ASX-listed defence contractors could see increased government spending as Australia strengthens its strategic capabilities.

Global diversification remains important, but the focus should shift towards countries and companies that stand to benefit from localisation and resilience strategies. ETFs focused on critical minerals, semiconductor manufacturing, and defence technology could offer broad exposure to these themes.

Key Risks to Watch

While the localisation trend presents opportunities, investors must be mindful of the risks:

• Geopolitical instability: Rising tensions between major powers like the U.S. and China could disrupt global markets and trade flows.
• Regulatory uncertainty: Rapid changes in trade policies and subsidies could create volatility for companies relying on government support.
• Supply chain bottlenecks: Reshaping supply chains takes time, and delays in infrastructure could impact profitability.
• Inflationary pressures: Localisation often raises production costs, which could lead to higher consumer prices and reduced demand.

Nomad Investor Takeaways

• Focus on sectors benefiting from localisation, such as semiconductors, critical minerals, and defence technology.
• Consider ETFs targeting green energy and digital infrastructure for broad thematic exposure.
• Australian investors should pay special attention to lithium and rare earth stocks on the ASX.
• Neutral countries like Canada and Australia offer geopolitical alpha; diversify into these markets for stability.
• Monitor regulatory changes and trade policies as they could impact profitability and valuations.
• Stay ahead of inflation risks by favouring companies with pricing power or government-backed subsidies.
• Adopt a long-term perspective; localisation is a multi-decade theme with enduring implications.

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Paul Ingersole

Nomad Investor

Global investing and wealth-building insights for the location-independent entrepreneur.

As we move into 2026, the global tech industry is facing a new bottleneck—and it’s not silicon or software. It’s power. With data centre power demand expected to surge by 17% this year, energy availability has become the defining constraint on tech growth. This is especially critical as artificial intelligence, cloud computing, and metaverse applications push the limits of traditional grids. For investors, the opportunity lies in the emerging “Powering AI” ecosystem: companies providing on-site, carbon-neutral energy solutions for tech giants. This year’s nuclear renaissance and the rise of small modular reactors (SMRs) could be transformative.

Power prices are already a political flashpoint, with blackouts and skyrocketing costs making headlines globally. Meanwhile, tech firms are increasingly bypassing strained public grids, opting instead for private energy solutions. From nuclear microreactors to grid-scale battery storage, these innovations are poised to redefine how we power the digital economy. The question is, how can investors position themselves to capitalise on this shift?

What’s Happening

In recent years, the energy landscape has shifted dramatically. While the drive for renewable energy has dominated headlines, the limitations of wind and solar—intermittency, storage challenges, and grid dependency—are becoming more apparent. Energy consumption by data centres alone now accounts for an estimated 3% of global electricity use, a figure that could rise to 5% by 2030 if current trends continue.

Enter the nuclear renaissance. Governments and private investors alike are pouring capital into next-generation nuclear technologies, particularly small modular reactors (SMRs). Unlike traditional nuclear plants, SMRs are compact, safer, and scalable. They can be deployed on-site at data centres, providing a steady and carbon-neutral energy supply. The International Energy Agency (IEA) projects that nuclear power capacity could grow by 15% globally by 2030, driven in part by SMRs.

At the same time, grid-scale energy storage is seeing unprecedented investment. According to BloombergNEF, global battery storage capacity is set to triple by 2027, enabling more efficient integration of renewables and reducing reliance on traditional grids. These developments are not just about cleaner energy—they’re about ensuring energy availability in an increasingly electrified world.

The Data Behind the Story

To understand the scale of this shift, consider the following:

In Australia, the stakes are particularly high. The nation’s ageing energy infrastructure has struggled to keep pace with demand, and power prices have been volatile. ASX-listed companies like AGL Energy and Origin Energy are under pressure to modernise their operations, while smaller players in the renewable and storage sectors are seeing increased investor interest.

What This Means for Investors

The “Powering AI” ecosystem offers a multi-layered investment opportunity. At its core are infrastructure firms developing SMRs and advanced battery systems. Companies like Nuscale Power and TerraPower are leading the charge in the nuclear space, while Tesla and Fluence dominate grid-scale storage.

Real assets, such as energy-focused infrastructure funds, are another avenue for exposure. These funds often provide stable, inflation-hedged returns—an attractive prospect in today’s unpredictable markets. Additionally, venture capital is flowing into startups tackling energy challenges, from hydrogen storage to AI-driven grid optimisation.

For Australian investors, the ASX offers indirect exposure through companies like Worley, which provides engineering solutions for energy projects, and Mineral Resources, which is expanding into lithium and battery materials. Additionally, superannuation funds are increasingly allocating to renewable and energy infrastructure projects, aligning with ESG mandates.

Key Risks to Watch

As with any transformative trend, the “Powering AI” ecosystem comes with risks:

• Regulatory hurdles: Nuclear energy, despite its advancements, still faces significant regulatory and public perception challenges.
• Technological uncertainty: Many SMR and battery storage projects are in early stages, and timelines for commercialisation are uncertain.
• Geopolitical tensions: The energy sector is highly sensitive to geopolitical risks, from resource nationalism to trade restrictions.
• Market saturation: Rapid investment in renewables and storage could lead to oversupply, pressuring returns.

Nomad Investor Takeaways

• Energy availability is the new growth constraint for tech, making power infrastructure a critical investment theme.
• Small modular reactors (SMRs) and grid-scale storage are leading the charge in the “Powering AI” ecosystem.
• Australian investors can gain exposure through ASX-listed companies like Worley and Mineral Resources, or via superannuation funds.
• Regulatory hurdles and technological uncertainty are key risks to monitor in nuclear and storage sectors.
• Global battery storage capacity is set to triple by 2027, presenting opportunities in lithium and related materials.
• Real assets and infrastructure funds offer a way to hedge against inflation while gaining exposure to energy innovation.
• Keep an eye on geopolitical tensions and market saturation risks that could impact long-term returns.

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Paul Ingersole

Nomad Investor

Global investing and wealth-building insights for the location-independent entrepreneur.

In 2026, the investment landscape is undergoing a profound transformation driven by the rise of Agentic AI. These autonomous systems, equipped with transactional authority, are not just assisting humans—they’re independently executing trades, optimising supply chains, and navigating complex compliance frameworks. The markets have moved beyond hyped buzzwords, and investors are now zeroing in on sectors where Agentic AI is delivering measurable impacts, particularly through margin expansion. Banking, logistics, and healthcare have emerged as standout secondary beneficiaries, showing 2x improvements in operational efficiency. This shift demands a recalibration of portfolios to capture the next wave of growth.

For Australian investors, this evolution presents opportunities that align with global trends while tapping into local sectors poised for technological disruption. As Agentic AI integrates deeply into core operations, its ripple effects are transforming traditional industries. The question now is: how can investors position themselves to benefit from this paradigm shift while mitigating potential risks?

What’s Happening

The AI narrative has evolved rapidly over the past five years. In the early 2020s, companies saw their stock prices surge by simply mentioning AI during earnings calls. However, the frenzy has subsided, replaced by a more discerning focus on tangible outcomes. Agentic AI represents the next frontier—autonomous systems capable of independent decision-making and execution within predefined parameters. Unlike early AI iterations that required constant human input, these systems are designed to act with minimal oversight, making them invaluable for industries reliant on precision and efficiency.

Banking is a prime example. Agentic AI is being deployed to automate complex compliance tasks, reduce fraud, and streamline loan approvals. Logistics companies are leveraging these systems to optimise routing, inventory management, and customs clearance, while healthcare providers are using them to enhance patient care, manage records, and even diagnose conditions. According to a recent McKinsey report, companies integrating Agentic AI into their operations have seen productivity gains of up to 40%, with traditional sectors experiencing significant margin expansion.

The Data Behind the Story

The numbers highlight the transformative potential of Agentic AI across secondary beneficiaries:

Australian companies are particularly well-positioned. Superannuation funds have begun allocating more capital to ASX-listed firms in logistics and healthcare, recognising their ability to leverage Agentic AI to drive efficiency. For example, the Commonwealth Bank integrated Agentic AI into its fraud detection systems, leading to a 12% drop in fraud-related losses in 2025.

What This Means for Investors

For investors, the shift to Agentic AI presents both opportunities and challenges. As the secondary beneficiaries demonstrate tangible returns, the focus should be on identifying undervalued companies within these sectors. Banking stocks, particularly those with strong AI-driven compliance capabilities, are poised for growth. Logistics firms integrating AI into their supply chains are already showing improved cash flows, while healthcare providers leveraging AI for patient management are gaining operational resilience.

Global equity markets are reflecting these dynamics. The S&P/ASX 200 has seen increased activity in logistics and healthcare stocks, with AI adopters outperforming sector averages. Investors should also consider thematic funds and ETFs focused on AI-driven transformation, which offer diversified exposure to this trend.

Key Risks to Watch

While the promise of Agentic AI is undeniable, several risks could impact its adoption and the performance of secondary beneficiaries:

• Regulatory Uncertainty: Governments are still adapting to AI’s rapid evolution, with new regulations potentially increasing compliance costs.
• Cybersecurity Threats: Autonomous AI systems handling sensitive tasks are prime targets for cyberattacks, which could erode investor confidence.
• Implementation Challenges: Not all companies are equipped to integrate Agentic AI seamlessly, leading to uneven adoption rates and execution risks.
• Market Saturation: As adoption increases, early movers may lose their competitive edge, flattening growth trajectories.

Nomad Investor Takeaways

• Focus on secondary beneficiaries in banking, logistics, and healthcare for tangible margin expansion opportunities.
• Monitor ASX-listed firms leveraging Agentic AI for operational efficiency and long-term growth.
• Consider thematic ETFs that offer diversified exposure to AI-driven sectors.
• Evaluate companies’ cybersecurity measures as a key factor in investment decisions.
• Stay updated on regulatory developments to anticipate potential compliance costs.
• Look for early signs of market saturation and adjust positions accordingly.
• Allocate capital to firms with proven implementation capabilities to mitigate operational risks.

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Paul Ingersole

Nomad Investor

Global investing and wealth-building insights for the location-independent entrepreneur.

Private credit has emerged as a transformative force in the financial markets, particularly in the wake of tighter banking regulations implemented in 2026. With traditional banks retreating from risk-heavy lending due to regulatory constraints, private credit funds have stepped in to fill the void. For Australian and global investors alike, this shift represents a seismic change in how corporate growth and infrastructure projects are financed. The focus on “Significant Risk Transfers” (SRTs) marks a new era where private funds assume risks that banks once held, offering higher yields but requiring a nuanced understanding of the underlying risks.

What’s Happening

The financial landscape has undergone a dramatic shift since 2026, shaped by stricter capital adequacy ratios and stress-testing protocols imposed on banks by global regulators. These changes have constrained banks’ ability to lend, especially for mid-market corporate borrowers and high-risk infrastructure projects. The result? Private credit has ballooned into a multi-trillion dollar asset class, far from its origins as a niche alternative investment.

Data from Preqin shows that private credit assets under management (AUM) globally reached USD 1.71 trillion by the end of 2025, up from USD 1.2 trillion in 2020. In Australia, private credit is increasingly integral to financing sectors like renewable energy, commercial real estate, and mid-sized corporate expansions. The ASX-listed private equity giant Pacific Equity Partners has even launched specialised funds to capitalise on this growing demand.

Significant Risk Transfers (SRTs) are at the heart of this trend. Banks offload portions of their loan books to private credit funds, effectively outsourcing the risk while maintaining client relationships. For investors, this creates opportunities for higher returns in exchange for assuming the role of shadow lenders in an increasingly complex financial ecosystem.

The Data Behind the Story

The numbers paint a compelling picture of private credit’s rapid ascent. Consider the following:

• Global private credit AUM grew at a compound annual growth rate (CAGR) of 13.4% between 2015 and 2025, according to McKinsey.
• Private credit funds accounted for 25% of corporate borrowing in the United States by 2025, up from just 8% in 2010, based on PitchBook data.
• In Australia, private lenders funded over AUD 6 billion in new mid-market corporate loans in 2025, a 40% increase year-on-year, according to KPMG.

At the core of this expansion is the appeal of higher yields. Private credit funds often offer returns in the range of 7–12%, depending on the risk profile, compared to sub-5% yields on investment-grade bonds. In a world of persistently low interest rates, this has been a game-changer for institutional investors such as superannuation funds in Australia, which are increasingly allocating to private credit to meet their return targets.

What This Means for Investors

For investors, the rise of private credit offers both opportunities and challenges. On the one hand, the asset class provides access to higher yields, enhanced portfolio diversification, and exposure to sectors that are often underrepresented in public markets. On the other hand, it demands a willingness to embrace illiquidity and a deeper understanding of credit risk.

Australian superannuation funds, for example, have been increasing their allocations to private credit to achieve higher income streams and match long-term liabilities. Retail investors, too, are gaining access through listed investment trusts (LITs) and private credit ETFs, which are now available on the ASX.

Strategically, private credit can act as a defensive allocation during times of equity market volatility, given its lower correlation to public markets. However, investors must also weigh the risks associated with rising interest rates and economic slowdowns, which could impact borrower solvency.

Key Risks to Watch

While private credit offers significant appeal, it is not without its risks. Here are the key considerations:

• Credit Quality: As private credit funds target higher-yielding deals, the risk of defaults in a downturn increases.
• Illiquidity: Investments in private credit are often locked up for 5–10 years, limiting flexibility.
• Rising Rates: Higher interest rates can strain borrowers, particularly in leveraged sectors.
• Regulatory Scrutiny: Increased oversight of private credit funds could lead to tighter restrictions and reduced profitability.

Nomad Investor Takeaways

• Private credit is no longer niche; it’s a mainstream asset class with global AUM projected to exceed USD 2.2 trillion by 2028.
• Australian investors can access private credit through ASX-listed funds, providing exposure to high-yield opportunities.
• Focus on funds specialising in infrastructure and renewable energy, as these sectors benefit from structural tailwinds.
• Be mindful of illiquidity risks and ensure private credit allocations align with your investment time horizon.
• Monitor credit quality carefully, particularly in higher-risk sectors like real estate and leveraged buyouts.
• Consider private credit as a defensive allocation, but stay vigilant about rising interest rates and potential borrower solvency issues.
• Diversify across geographies and sectors to mitigate concentrated risks within private credit portfolios.

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Paul Ingersole

Nomad Investor

Global investing and wealth-building insights for the location-independent entrepreneur.

The rapid advancement of artificial intelligence (AI) is no longer a theoretical discussion—it’s hitting the labour market at scale, and the consequences are profound. A stark “K-shaped” economic divide is emerging: high-income professionals are leveraging AI to turbocharge their productivity, while lower-income roles face significant displacement risks. For investors, this bifurcation is creating opportunities at both ends of the spectrum—luxury goods and wealth management for the thriving “AI-augmented” class, and the reskilling industry for those navigating a turbulent transition.

This dynamic matters because it’s reshaping not just the economy, but the very fabric of society. The ability to adapt to AI, both as an individual and as a business, is becoming a defining factor of economic success. The question for investors is clear: how do you position your portfolio to ride this wave while mitigating the risks?

What’s Happening

AI adoption in the workplace has accelerated dramatically over the past three years. Generative AI tools such as ChatGPT, MidJourney, and GitHub Copilot are being integrated into workflows, enabling knowledge workers to complete tasks faster and more efficiently. According to a 2023 McKinsey report, up to 60% of current jobs have at least 30% of their tasks that could be automated by AI. This is not just a Western or tech-centric phenomenon—AI is permeating industries globally, from finance to healthcare, manufacturing to education.

At the same time, low-skilled jobs in areas like retail, customer service, and logistics are under significant threat. Goldman Sachs recently projected that 300 million full-time jobs globally could be affected by generative AI, with lower-income workers disproportionately impacted. This divergence is creating what economists are calling a “K-shaped recovery”—a scenario where one segment of society flourishes while the other struggles to keep pace.

Australia is far from immune. The Reserve Bank of Australia (RBA) notes that while the domestic labour market remains relatively strong, certain sectors—particularly retail and administration—are already seeing early signs of automation-induced disruption. This is mirrored by the ASX, where companies in the education and upskilling space are attracting investor interest as the demand for reskilling grows.

The Data Behind the Story

The numbers tell a stark story of divergence. Here are three key data points that highlight the scale of the challenge:

In Australia, specific industries are already seeing the economic divide. ASX-listed companies in the luxury retail sector are reporting robust growth, while education-focused firms like IDP Education and SEEK are seeing increased demand for reskilling services. Meanwhile, unemployment trends in retail and customer service are showing early signs of structural weakness, particularly in regions reliant on these sectors.

What This Means for Investors

For investors, the “K-shaped” divide offers both opportunities and risks. On the opportunity side, luxury goods and wealth management firms are poised to benefit from the rising disposable income of the AI-augmented class. Companies like LVMH and Ferrari are already reporting record sales, while the wealth management industry is innovating to cater to tech-savvy high-net-worth clients.

On the other end of the spectrum, the reskilling industry is emerging as a critical growth area. Firms providing online education, vocational training, and AI-related skills development are attracting significant capital. Coursera, Udemy, and Australia’s own SEEK are examples of companies well-positioned to capitalise on this trend.

Real assets like property may also see divergent impacts. High-end residential property in major cities could benefit from the AI-augmented class, while retail and office spaces in automation-affected regions might face declining demand.

Key Risks to Watch

While the opportunities are compelling, there are significant risks to consider:

• Social unrest: Widening economic inequality may lead to political instability, regulatory interventions, or increased taxes on capital gains.
• AI regulation: Governments may impose restrictions on AI development or usage, impacting the profitability of AI-reliant businesses.
• Reskilling bottlenecks: If the pace of reskilling fails to match AI-driven job displacement, consumer demand in affected sectors could weaken further.
• Market overvaluation: The luxury and education sectors may become overvalued if investor enthusiasm outpaces fundamentals, leading to correction risks.

Nomad Investor Takeaways

• Consider adding luxury goods and wealth management stocks to your portfolio to tap into the AI-augmented class’s rising spending power.
• Explore investments in the reskilling and upskilling sector, focusing on companies with scalable, tech-enabled platforms.
• Stay diversified across geographies and asset classes to mitigate the risks of AI-driven economic polarisation.
• Monitor regulatory developments closely, particularly in major economies like the US, EU, and Australia.
• For Australian investors, watch ASX-listed education and luxury retail stocks for local exposure to these themes.
• Evaluate real estate investments carefully, favouring high-end residential markets over retail or office spaces in automation-affected regions.
• Maintain a long-term perspective, as both the opportunities and risks associated with AI will unfold over decades, not quarters.

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Paul Ingersole

Nomad Investor

Global investing and wealth-building insights for the location-independent entrepreneur.

The rise of artificial intelligence (AI) is no longer a distant future concept — it’s here, and it’s reshaping the labour market at an unprecedented pace. While some professionals are leveraging AI tools to drive exponential gains in productivity, others are grappling with mounting displacement risks. This stark “K-shaped” economic trajectory is creating two distinct investment opportunities: the luxury and wealth management sectors catering to the “AI-augmented” class, and the reskilling industry, which is poised to help millions transition into new, human-centric roles. For Australian investors, this seismic shift offers both challenges and opportunities in portfolio positioning.

What’s Happening

AI adoption has accelerated dramatically, with tools like ChatGPT, MidJourney, and other generative AI platforms now widely accessible. These applications are empowering high-income professionals — particularly in fields such as finance, law, and technology — to amplify their output and command even higher earnings. On the other hand, roles in manufacturing, retail, and basic administrative functions are increasingly under threat of automation. A recent report by McKinsey estimated that up to 375 million workers globally will need to switch occupational categories by 2030 due to AI and automation.

In Australia, the Reserve Bank of Australia (RBA) has noted in its labour market insights that technological change is likely to exacerbate wage disparities. While some sectors flourish, others face a dire need for reskilling initiatives. With Australia’s unemployment rate hovering at 3.7% as of August 2023, the challenge lies not in job availability but in job suitability for displaced workers.

Adding fuel to the fire, the rise of AI is coinciding with a high-interest-rate environment, squeezing consumer spending at the lower income brackets. This dual pressure — technological disruption and economic tightening — is intensifying the divide.

The Data Behind the Story

The impact of AI on the labour market is already visible in the numbers. Consider these key statistics:

Australia is no exception. A Deloitte Access Economics report highlights that over 3 million Australian workers will need reskilling or upskilling by the end of the decade to stay relevant. Meanwhile, the luxury goods market is defying economic gravity, with Bain & Company forecasting a 5-7% annual growth rate globally through 2030, fueled by high-income earners who are thriving in the AI era.

What This Means for Investors

The bifurcation of the labour market translates into distinct investment themes for savvy investors. On one end, there is a clear opportunity to invest in companies serving the affluent “AI-augmented” class. Luxury goods, premium real estate, and wealth management firms are poised to benefit from this cohort’s rising disposable incomes.

On the other end, the reskilling industry is emerging as a crucial growth sector. Companies providing vocational training, online education, and workforce transition services are seeing a surge in demand. ASX-listed companies like SEEK (ASX: SEK), which have exposure to job training and employment services, could be worth a closer look.

Additionally, global equity exposure to luxury brands like LVMH or Hermès could be increasingly attractive, given their resilience during economic downturns. For Australian investors, ETFs that track the global luxury market or education technology could diversify exposure to these trends.

Key Risks to Watch

While the opportunities are compelling, there are risks that investors should monitor carefully:

• Regulatory Overreach: Governments may impose stricter regulations on AI, potentially slowing its adoption and altering market dynamics.
• Economic Polarisation: Widening income inequality could lead to social unrest or policy interventions that disrupt luxury market growth.
• Reskilling Bottlenecks: The reskilling industry may struggle to scale quickly enough to meet demand, leading to labour shortages in key sectors.
• Market Volatility: High-growth sectors like luxury goods and education technology are often sensitive to broader market corrections.

Nomad Investor Takeaways

• Focus on investment themes that benefit from AI-driven economic shifts, such as luxury goods and reskilling industries.
• Consider allocating to reskilling-focused companies like SEEK (ASX: SEK) or global education technology firms.
• Diversify into global luxury brands like LVMH or Hermès to capture gains from the “AI-augmented” class.
• Monitor regulatory developments in AI, as policy changes could disrupt growth trajectories.
• Be cautious of economic polarisation risks, which could lead to social or political instability.
• Explore ETFs that provide exposure to both luxury and education technology sectors for a balanced approach.
• Maintain a long-term view, as the economic and labour market transformations will unfold over decades, not months.

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Paul Ingersole

Nomad Investor

Global investing and wealth-building insights for the location-independent entrepreneur.