The company expressed caution about the so-called ‘hyperscalers,’ noting market recognition in January of their capital expenditure challenges and profit pressures.

The fund has an objective to uncover stocks in Europe which have the potential for attractive absolute returns on a five-year view, which it then aggregates into a portfolio to compound absolute wealth over the medium-term.

Market volatility this quarter stemmed from accelerating geopolitical tensions and AI disruption, with indiscriminate share price movements.

The Goodhart Future Leaders team revisited its earlier assessment of AI’s threat to software businesses, analyzing company-level evidence six months later.

The data centre industry traditionally prioritizes copper for short-distance, low-latency data transmission, using optics only where copper is impractical.

The author argues that planned AI capital expenditure may not earn sufficient returns, suggesting limited spending over the next 5–10 years.

Market performance this quarter showed limited impact from the Iran war and closure of the Strait of Hormuz, unlike the defense sector’s reaction to the Ukraine conflict in 2022.

The company noted that recent quarterly returns reflect progress in its investment process, though one quarter provides limited evidence of long-term success.

The third quarter felt like a turning point for the portfolio after a tough first half of 2026. The conflict in Iran and fears that artificial intelligence would wipe out software businesses led to indiscriminate selling across the sector. Good companies were sold alongside weak ones. In the third quarter, many of those good companies began to recover as their results came through.

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Carly joined Goodhart Partners in 2014 as a Sales Support Analyst, with prior experience at Russell Investments and Williams de Broe (now Investec).

Emma joined Goodhart in 2016 as a Sales Support Analyst and later transitioned to the Accounts team as an Operations Analyst, pursuing ACCA qualification.

Goodhart Partners provides legacy operational and distribution-related services to these asset managers.

Richard manages the Global Smaller Companies strategy, focusing on long-term compounding stocks with sustainable competitive advantages and strong cash flows.

The company offers investment strategies and encourages inquiries for further details.

Goodhart is a global equity boutique managing a range of global and regional equity strategies with distinctive approaches and processes, but a common commitment to agile investing.