After a secular rise in equity prices in 2023 and 2024, extended valuations and high concentration laid the groundwork for factors to stabilize market excesses. In the context of risk efficiency, the factor-driven narrative becomes even more compelling.
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The framework aligns risk attribution with the way investors construct and manage portfolios — ensuring that risk insights reflect the investment process and are not dictated by the risk model construction.
Demand for critical minerals is set to accelerate, driven by the rapid adoption of artificial intelligence in clean energy technologies, next-generation semiconductors and advanced digital infrastructure. Strategies for the same are likely to lead to further investment in exploration, refining and processing, thus reshaping supply chains and market dynamics.
The recent large moves in the US dollar have brought the idea of currency hedging to investor attention. Currency hedging is often ignored when discussing international equity investments but this recent period of unusual currency moves (discussed in another insight) reminds us of the impact of currency risk.
Currency risk can be material, and hedging decisions can make a real difference to return the outcomes. At a time when markets are witnessing sharp shifts in historic relationships, such as that between the US dollar and US equities in 2025 thus far, it is worth revisiting those decisions.
Despite the dollar’s recent weakness, the structural advantages of deep and liquid US financial markets, its dominant role in trade invoicing and as a monetary anchor, are sustaining its primary reserve currency status.
With the recent market volatility, indices have become a central feature of the daily news. But they are not just numbers that go up and down to reflect market movements.
Geopolitical tensions, monetary policy shifts, and supply chain disruptions are creating challenges and opportunities for businesses in 2025. Corporates must navigate these complexities to manage global operations and capital flows effectively.
The developments over recent months present a compelling narrative of potential transformation in the European financial landscape. While challenges persist, recent policy shifts, investments, and market recoveries signal a newfound resilience and optimism in the EU's economic prospects.
Despite economic setbacks during the Great Recession and Covid-19, South Africa is poised to almost double its growth in 2025 and 2026. Financial reforms, lower rates and inflation are expected to foster an environment of stronger consumer spending.
Three pivotal events mark shifts in market sentiment over the four months since November 2024—the US election outcome, the Fed’s December policy meeting and the February 2025 release of a key US consumer sentiment survey.
At the start of 2025, we expect to see a continued dynamic evolution in the sustainable investment market. The regulatory landscape is evolving, with the review and development of both sustainable investment and ‘real economy’ regulations across multiple global regions.