Stock markets are driving excessive however some investments are nonetheless low-cost: David Coombs on how one can defend and revenue

Investors face a conundrum. Stock markets are hitting record highs at a time when they are increasingly worried about a bubble spectacularly bursting. 

Meanwhile, despite widespread fears that a highly concentrated market is being led higher by expensive tech stocks juiced up by AI hype, the investment world remains bullish. 

On this episode of the Investing Show, David Coombs, head of multi-asset investments at Rathbones discusses with Simon Lambert how to navigate this tricky market, protect yourself and make money. 

He says that while markets may be at record highs, that doesn’t mean everything is expensive – and his team are ‘finding lots of value’ among companies that have looked ‘very cheap’.

As a multi-asset manager, Coombs has the ability to invest wherever he chooses, which he says is an advantage when targeting different levels of return that can reflect investors’ appetite for risk.

‘We don’t have an index we need to be measured against’, he says. ‘If a fund manager has a benchmark, you’ve already given them the asset allocation.

‘With a multi-asset fund we don;t have that starting point. We literally start with a blank piece of paper and build up to generate that return.

He adds: ‘In a passive world you just buy everything, good bad or indifferent. We’re trying to select the best in every aset class to generate the maximum return. The biggest band for your buck.

Coombs explains how he positioned his funds in 2025 – a year that delivered good returns on paper but involved a rollercoaster ride. He details how his team took opportunities on offer, trading against the market as investors panicked after Donald Trump’s tariff announcement and getting into some very good companies at cheap prices.