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Range Thinking in a “Wicked” Investing World
We’ve been thinking a lot about AI (maybe as much as AI has been thinking about us!). There are potential positive and negative shocks to our economy and workforce from AI. For many in the investment industry, the question has been how to invest in AI, what growth drivers it presents, and for what businesses (or more specifically, publicly traded equities).
Another big reason we’ve been thinking about it, even as markets got choppy from geopolitical tensions, AI-related spending and earnings expectations have stayed resilient, reinforcing a ‘keep the trend going’ environment.
This leads us to really think about “Range.” David Epstein’s Range is often read as a career book. At a high level, it’s a review of generalists versus specialists in different fields. However, it has much to share on human performance that relates to investing, and really, decision-making in a changing world.
Investment writer Laurence B. Siegel notes that advisors should be “particularly interested” in Epstein’s question, whether generalist thinking improves problem-solving, because it matters directly for investing. Siegel calls markets a “human zoo”: to invest well, we need to understand recurring human patterns (greed, fear, ignorance) while keeping faith in long-run progress that makes investing worthwhile.
A core idea in Range is the distinction between “kind” and“wicked” learning environments. Kind environments have stable rules, repeating patterns, and fast, accurate feedback. This is where specialization shines. Wicked environments have shifting rules, messy signals, and delayed or misleading feedback. What worked in one period may not work in the next and can even hurt you. Investing is firmly in the “wicked” category.
Markets may rhyme, but they don’t repeat; the same “signal” can mean different things depending on inflation, rates, oil prices (we’ve been feeling that lately), valuations, positioning, and sentiment. And in wicked environments, narratives can turn into bubbles when positioning and valuation stretch.
That’s why the Range mindset, where breadth, humility, and the ability to transfer learning across contexts, can map so cleanly to portfolio construction, and specifically, diversification in portfolio construction. Diversification across asset classes and within them is the portfolio version of Range.
Diversification isn’t just about owning more names but also different economic engines. Geographic diversification mitigates volatility and country risk, while sector diversification reduces reliance on a single industry. In a dynamic environment where leadership shifts and winners change, a broader opportunity set across different economies and industries strengthens the plan’s resilience.
That’s why the smartest stance on AI isn’t “all-in” or “stay away.” In our opinion, it’s Range-thinking. Treat AI as a real structural shift and treat today’s AI trade as a regime of risk, where concentration and narrative can outrun fundamentals. A big reason “AI bubble” anxiety feels different from older tech booms is that it’s happening alongside extreme index concentration, particularly in the S&P 500.
As you can see in the chart below, the Magnificent 7 (the Mag 7) stocks, as they are known, have a weight in the S&P 500 reached 35.3% as of April 19, 2026.
At the same time, it’s not purely froth in the market. In the chart below, you see where the S&P performance year-to-date has come from. And in a nutshell, it’s earnings. Simply put, businesses making money.
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The tension is the wicked leap from fact to forecast. The scale of AI spending is immense, and the market is implicitly underwriting strong returns on that capital. If profits and productivity lag the capital being deployed, sentiment can change quickly, especially in a concentrated market. Or, the AI story comes to fruition, and the growth continues.
Range reflects what diversification seeks to achieve. It’s all about staying adaptable in an uncertain future. While specialization claims, “I know the answer, so I’ll focus," range suggests, “I understand what could matter, so I’ll create options." We prefer range.
PWM Tax & Accounting Services Update:
As the tax filing deadline approaches, our tax team continues to work diligently to support you. We are still accepting documents and information, and we encourage you to submit any outstanding items as soon as possible to help ensure timely and accurate filing. Even if the deadline has passed, our team can still prepare and file your return and assist with next steps, including minimizing penalties and interest where possible. Please don’t hesitate to reach out—we’re here to help.
