Geopolitical uncertainty prompts conservative investment stance—Morgan Stanley

[Wall Street sign, New York City, USA]
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Ben Huneke, head of Morgan Stanley Investment Management, is urging clients to take a more conservative approach as geopolitical uncertainty continues to roil markets (SP500 [https://seekingalpha.com/symbol/SP500]).

In a CNBC interview, Huneke, who oversees $1.9T in assets, said the firm has cautioned investors to increase liquidity and reduce portfolio duration amid dramatic market swings.

“There’s so much volatility (VIX [https://seekingalpha.com/symbol/VIX]),” Huneke said. “We’ve cautioned our clients to maybe be a little bit more conservative, a little bit more liquid, take a little duration out of the portfolio potentially, but it’s really hard to be tactical when stuff is changing so dramatically.”

Huneke noted that while the earnings outlook heading into 2026 was strong, recent events have clouded the picture. He acknowledged that predicting outcomes has become exceptionally difficult given the wide range of possible scenarios, particularly regarding the situation in Iran.

Despite the uncertainty, Huneke identified opportunities in the software sector (IGV [https://seekingalpha.com/symbol/IGV]), particularly within private credit (VPC [https://seekingalpha.com/symbol/VPC]). He said fears about AI’s (AIEQ [https://seekingalpha.com/symbol/AIEQ]) impact on software companies may be overblown.

“We don’t believe that there is a mass casualty or mass extinction event happening in software,” Huneke said, adding that institutional clients are increasingly viewing current conditions as an opportunity to allocate into private credit.

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