Investment Outlook 2025
Spinning Around
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We live in volatile and unpredictable times…Looking for alternative sources of diversification will be crucial. |
We explore:
 The US is likely to secure a soft landing amid rate cuts and ongoing disinflation. However, as US economic growth cools, it will appear less exceptional versus the rest of the world. |
 Policy uncertainty means that investors need to be prepared for market volatility. Markets are primed to rotate – higher-for-longer interest rates can have knock-on effects and stock laggards can become leaders. We think alternative sources of diversification should be a priority. |
 Emerging and frontier markets trade at a discount and have the potential to deliver good returns. We have identified other assets that could perform well in this environment, which we outline in the report.* |
Discover our 2025 Global Investment Outlook Report
The US is likely to secure a soft landing amid rate cuts and ongoing disinflation. However, as US economic growth cools, it will look less exceptional compared with the rest of the world.
Rising geopolitical tensions, increasing protectionism (including the use of tariffs and national industrial policies), and concerns about global economic fragmentation are likely to result in a market rotation.
That will have implications for the way we structure portfolios. In particular, we are looking beyond bonds to achieve diversification.
We introduce three key themes to consider:
- Macro in motion
Inflation may be largely beaten as a multipolar world emerges and growth rates converge. - Market rotations
Stock returns are broadening out. Boasting premium economic growth rates, emerging and frontier markets present appealing options. - There is always an alternative
Credit, hedge funds and real assets could provide sources of diversification.**
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* This information shouldn’t be considered as a recommendation to invest.
** The views expressed above were held at the time of preparation and are subject to change without notice. This information shouldn’t be considered as an investment advice to invest in the sectors shown. Diversification does not ensure a profit or protect against loss.
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