Vince Childers, manager of the Cohen & Steers Diversified Real Assets fund, joins the FundCalibre team to discuss all things real assets and examines their strategic importance in modern portfolios. He explains the four key categories — global real estate, infrastructure, commodities, and resource equities — and how they respond to inflation shocks and market surprises. They discuss a range of topics from valuation trends, long-term performance and the influence of AI to practical considerations like liquidity and portfolio construction. This interview is a great listen for those looking to navigate market volatility while enhancing risk-adjusted returns.
Why you should listen to the interview: This episode is essential listening for anyone seeking to understand how real assets can safeguard portfolios against inflation, diversify risk, and capitalise on market opportunities.
This interview was recorded on 25 September 2025. Please note, answers are edited and condensed for clarity. To gain a fuller understanding and clearer context, please listen to the full interview – see below.
Interview highlights:
Defining real assets and their role today
“If I zoom way out, most of the time when we talk about real asset investing we’re gonna be primarily focused on opportunities available in the listed exchange traded markets around the world. We think about real assets as this pretty diverse category of investments spanning a lot of different securities industries and sectors. But when we roll it all up, it usually boils down into kind of four major groups.
“So you’ve got your global real estate investments, REITs, and owners and operators of commercial real estate. We like exposure to commodity futures as well. And then other equity investments include resource equities, so energy related companies, metals companies and agriculture related equities. And then finally listed infrastructure globally.
“So it’s a pretty broad group of investments, but what we think they bring to the portfolios is inflation sensitivity. The basic idea would be, these are assets that tend to outperform bonds and stocks in environments when inflation is shocking to the upside.”
Diversification benefits
“Let me go back to the inflation story, because there’s really only one way we think about this, right? I think negative inflation sensitivity is built into the equity and fixed income pieces that dominate pretty much everybody’s asset allocation exercise. If we look at the first half of 2022, inflation surprises and inflation itself was peaking. At that point when you had this peak, if you look back on a year over year basis, the MSCI World was in negative territory. Pretty much every fixed income instrument in the developed world was in negative territory. But the benchmark for our strategy was up nearly 20% at the same time.”
The era of scarcity
“AI actually ties into a theme we’ve talked about in publications in recent years – and the obvious demand for data intensity that’s associated with the AI boom. Data centres are in real estate indices and are a healthy component of it, but there’s also the power demand behind all of this. We’ve talked about the environment of resource scarcity – and the need for more energy. The power generation need has only increased the more that AI has taken off.
“The numbers that are being talked about are $3 trillion of AI related capital investment through 2030. These are staggeringly large numbers for an investment. And these things need to be built. They need to be powered. And we touch that world. Our real assets will touch that world in terms of the build out and power generation.
“Other things that impact us that are a little bit different, but maybe tied to the resource scarcity argument, is that through much of the mid 2010s we were living through the tail end of a big commodity CapEx boom that in many places ended up disappointing – not generating the economic returns wanted. We’re now in a world where there isn’t a lot of appetite to build out new supply across a whole lot of commodities.”
Conclusion: Real assets are increasingly critical in navigating today’s unpredictable markets. While no asset class is immune to shocks, understanding their unique sensitivities and interrelationships allows for smarter portfolio construction. From the potential of commodities to the influence of mega-trends like AI, strategic allocation to real assets offers a compelling path to both diversification and inflation protection.
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