ETF Edge

## BlackRock’s 2026 Investment Outlook: AI, Income, and Diversification

BlackRock, the world’s largest asset manager, is charting a course for investors in 2026, focusing on three key pillars to navigate the evolving market landscape. Here’s a breakdown of their strategy:

• Artificial Intelligence (AI): BlackRock sees AI as a long-term growth opportunity, driven by infrastructure spending and productivity gains. They are actively involved in AI-focused ETFs, such as the iShares A.I. Innovation and Tech Active ETF (BAI).
• Income: With expectations of falling interest rates, BlackRock emphasizes the need to find new sources of income to diversify portfolios. Investors who previously relied on money markets may need to reposition their investments.
• Diversification: Given increased market volatility and narrow market leadership, BlackRock stresses the importance of diversification. They suggest exploring assets that behave differently from stocks and bonds to mitigate risk, as traditional 60-40 portfolios are proving less reliable.
• Precision over Broad Exposure: BlackRock believes that investors need to be more deliberate about their exposure, especially in the U.S. equity market, where a few mega-cap tech stocks dominate returns.

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