In a recent Institutional Investor article, journalist Stephen Taub takes an in-depth look at how Bridgewater has evolved structurally and strategically over the past five years, highlighting leadership changes, advances in artificial intelligence, and a sharpened focus on navigating heightened macroeconomic risks. Together, these developments, he writes, have positioned the firm as it looks ahead to a highly uncertain investment landscape.
“Entering 2026,” Steve writes, “the firm is confident it is well positioned.”
A central theme of the article is Bridgewater’s assessment of the current market environment. Greg Jensen, Bridgewater’s Co-CIO and Managing CIO for the Alpha Engine and AIA Labs, describes a backdrop defined by both opportunity and risk. “The markets are entering a period of easing monetary policy and transformation of technology. Looking ahead to 2026, the firm sees a risky environment for many investors. The combination of easier monetary policy next year against the backdrop of transformational technology creates fertile ground for a potential bubble. Bubbles are hard to navigate and create risks for many investors, as there can be many major drawdowns even as markets rally to new highs. But in this risky environment, Bridgewater also sees opportunities, as it has been focused on building a leading understanding of the AI capex boom and how it is affecting economies and financial markets.”
Steve also details how Bridgewater’s leadership and governance structure has evolved to support this environment. “These started in 2020 when founder Ray Dalio moved out of the investment decision-making role and an investment committee was created,” he says. He goes on to describe how CEO Nir Bar Dea led a major restructuring in 2022 after becoming CEO, and that today Bridgewater is led by CEO Nir Bar Dea and co-CIOs Greg Jensen, Bob Prince, and Karen Karniol-Tambour.
The article further explains how accountability and clarity of responsibility have been sharpened in recent years. Steve notes that in 2024, “with the goal of personal accountability, Bridgewater gave each of its three CIOs responsibility for a specific area. Jensen is focused on the firm’s Alpha Engine (Pure Alpha and AIA), Prince on portfolio resilience, and Karniol-Tambour on Asia strategies.” He also highlights other key management changes, writing that “Erin Miles is now head of the Alpha Engine; Sean Macrae is head of research for Alpha Engine; and Blake Cecil, Ben Melkman, and David Trinh are deputy CIOs.”
Artificial intelligence is another major focus of the article. Steve explains that in 2022, Bridgewater created AIA Labs, which he describes as “a dedicated group within Bridgewater whose goal is to use artificial intelligence and machine learning to generate returns in the market.” He notes that the firm views its work in AI as the product of a long-term effort, emphasizing that “the firm stresses that its systemic expert systems are the foundations for the next AI step, which it has been working on since 2012.” According to the article, “In AIA, humans train the machine that determines the rules. In the other strategies, AI techniques allow humans to systematize human intuition more efficiently.”
Greg reinforces this long-standing commitment, explaining that “since 2012, Bridgewater has aggressively pursued the vision of the artificial investor that can do everything a human can, with computers not just representing the insights but also generating the insights themselves.”
The article also notes structural changes aimed at maintaining agility. Steve writes that in 2023, “Bridgewater also capped the firm’s assets under management… and expanded equity ownership from just 1 percent to more than 60 percent of its employees.” Greg comments on the impact of these changes, saying, “The changes we’ve made have ensured we are able to remain uniquely nimble and diversified, and we’ve been seeing the benefits of our strategy unfolding.”
Looking ahead, Steve outlines the key macroeconomic themes Bridgewater is monitoring. These include “modern mercantilism, which it believes is the biggest global economic change since World War II; extensive portfolio concentrations in U.S. assets; and artificial intelligence.” He references a recent Wall Street Journal op-ed authored by Greg, which describes modern mercantilism as resting on four tenets: the state playing a large role in orchestrating the economy to increase national wealth and strength; the importance of trade balances; the use of industrial policy to promote self-reliance and defense; and the protection of national corporate champions.
Greg adds that “as part of modern mercantilism, the push for resilience over efficiency will impact productivity, government policy will play an increasing role in driving growth, and there will be a new set of winners and losers as the global economy is actively reshaped.”
Against this backdrop, Steve writes that “With all this in mind, Bridgewater is heading into 2026 prepared to confront several key potential developments.” Greg underscores the stakes, saying, “It will be extremely complex and dangerous for many investors.”
The article goes on to describe Bridgewater’s concerns about institutional decay, noting that “the firm is watching the decay of institutions such as the Federal Reserve, the judicial system, and international organizations.” Discussing the implications for fixed income markets, Greg says the bond market “has the worst supply in aggregate ever,” adding that the private sector must absorb bonds in an uncertain environment where central banks are losing power, and that the “continued use of fiscal policy could lead to more inflation.”
Greg also points to risks in rates markets, noting that 2026 could be a “dangerous year for interest rates, which could lead to a bubble and hurt the long end.” He adds that he is “watching the development of AI, which will result in winners and losers, as well as how nations will deal with tariffs as countries like Germany and Japan build up their militaries.”
The article concludes with Greg reflecting on the environment investors face as monetary policy eases and technological change accelerates: “We are entering a period of easing monetary policy and transformation of tech which could lead to bubble dynamics. We don’t know the turning point, but there will be major equity drawdowns along the way.”
Returns quoted in this article are net total, as of Dec 31, 2025. Past performance is not necessarily indicative of future results. There is no guarantee that the results shown or referred to can or will be achieved in the future. Investment strategies that utilize AI are subject to certain additional types of risk, described here. Please see important disclosures and other information.