2026 Investment Outlook Part Three: Framing, Perspective, and Long-Term Vision



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What this video's about

In the final installment of our three-part 2026 investment outlook series, Paul Gifford, Chief Investment Officer at 1st Source Bank, sits down with Pete Cahill, Senior Portfolio Manager, to explore the idea of "framing" in investing. This concept, drawn from behavioral finance, helps investors view markets through a broader and more constructive lens.

Pete expands on themes from his recent article in the print version of our Investment Outlook, offering a perspective that blends 25 years of market experience with lessons for the years ahead. If you would like to request a copy, contact your advisor, send us an email at [email protected], or call us at 800-882-6935.

A year of headlines, noise, and volatility

Pete notes that 2025 has delivered no shortage of headlines. Political shifts, global tensions, economic crosscurrents, and market swings have all competed for attention. "As we move into 2026," he explains, "it's important to step back and maintain perspective."

Framing helps investors separate signal from noise. It pushes them to look beyond short-term fear and refocus on long-term strength, opportunity, and resilience.

What framing really means for investors

In his article, Pete describes framing as the way information is presented, and how that presentation shapes decisions. Two statements can be equally true, yet lead to different reactions:

• "The market is down 10% this year."
• "The market has averaged 7% annual growth over the past decade."

One sparks worry. The other highlights stability. The key is stepping back far enough to see the full picture.

Pete writes that framing asks important questions:
Are we viewing volatility as a threat to liquidity or as an opportunity for long-term positioning? Are we interpreting economic signals through fear or through resilience? A wide view encourages the latter.

Lessons from 25 volatile years

During their conversation, Pete acknowledges Paul's milestone: 25 years at 1st Source Bank. That period includes some of the most turbulent chapters in modern market history.

Such as:

• The dotcom bubble
• 9/11
• The Great Financial Crisis
• COVID-19
• Ongoing geopolitical uncertainty

Yet alongside each disruption, they've watched profound innovation reshape the world. The last 25 years have brought the rise of the internet, smartphones, cloud computing, digital commerce, AI, and breakthroughs in healthcare and biotechnology.

This blend of turmoil and transformation reinforces a key message: markets bend, but they do not break. Innovation pushes forward even during periods of stress. As Pete puts it, "Markets are resilient. Innovation drives progress."

The wide view for 2026 and beyond

Pete's written piece outlines three areas where a wide frame is especially important heading into 2026.

Interest rates

Rates today feel high compared to the ultra-low era of the early 2020s, but historically they are normal. This reframing positions today's fixed income market as a return to income, rather than a penalty.

Equity markets

Volatility has returned, along with meaningful dispersion across sectors. This environment rewards diversification, disciplined rebalancing, and customized planning.

Global dynamics

Despite tense headlines, supply chains are adapting, the energy transition is progressing, and emerging markets continue to innovate. A narrow view sees risk. A wide view sees transformation.

Pete emphasizes that our role is not only to manage portfolios, but also to help clients manage perspective. That includes:

• Providing historical context
• Connecting daily headlines to long-term plans
• Encouraging discipline over emotion
• Tailoring communication and portfolios to each client's goals

Framing is not just a bias to overcome. It is a strategic tool that supports better decision-making.

Conclusion

As we look to 2026, the wide view matters more than ever. It helps investors stay grounded during volatility and focused during times of uncertainty. With patience, perspective, and purpose, investors can navigate change with confidence.

Want to stay informed as markets evolve? Subscribe to The Market Share for steady insights that help you understand how shifting conditions affect your financial future.

And if you want a physical or digital download of 1st Source Bank's 2026 Investment Outlook, email [email protected]or give us a call at 800-882-6935. Here's to a happy, prosperous 2026!

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