Where skill meets precision

Trump tariffs spell ongoing volatility

The S&P 500 set new records in 2024³, leading many to believe that some exposure to US stocks was essential in any allocation to equities in 2025. But that belief has been knocked in the early stages of this year, first by worries about the strength of the AI trade, then by a dramatic shift in US trade policy, among other changes wrought by US President Donald Trump. If the start of the year is anything to go by, the path forward for US equities will likely be filled with more volatility and greater dispersion. Yet it’s also an environment that continues to be attractive for active managers, especially those characterised by strong conviction, deep research and high precision.

Take advantage of US growth and US value opportunities:

Magnificent 7 made up 30% of S&P

At one point in 2024, the Magnificent 7 comprised nearly 30% of the S&P 500⁴. The concentration of today’s stock market means diversification, analysis, and time-tested investment themes are more important than ever – especially as investors look beyond mega-cap tech stocks and towards new sectors, styles and emerging markets. Additionally, thematic equity investments continue to offer an alternative way to harness disruptive and innovative technologies without the limitations that come with a concentrated sector bet.

Two-thirds say uncertainty calls for active

According to our 2025 survey, more than two-thirds of wealth managers say uncertain markets call for active management, and 63% think markets will favour active investments this year⁵. Clearly, the investment environment we lived in from 2010 to 2020 was abnormal. Looking ahead, ‘back to normal’ is likely to be characterised by stickier inflation, higher rates, and market diversification, providing active portfolio managers with plenty of new opportunities to meet changing investor objectives.

Discover our full range of active equities investment managers:

73% think transitions offer investment opportunities

From the rise of artificial intelligence to the maturing conversations around sustainability, transitions are already underway that will reshape the way we live, work, and do business. As investors seek to navigate this changing environment, understanding the key trends and transitions that are shaping the future will be crucial for making informed decisions and capturing value. Indeed, our survey of wealth managers found 73% believe major transitions such as energy, demographics and governance represent significant investment opportunities for their clients⁵.

For equities investors, these might include:

• How recent breakthroughs in deep learning, generative AI and foundation models are changing the game when it comes to rates of discovery and prediction.
• Other long-term themes that have not received as much attention as AI, which are trading at lower valuations and could hold just as much investment potential over the next ten years.
• Areas such as global supply chains and water sanitation, as well as opportunities for advancements in obesity drugs and cancer treatments as part of wider innovations in the healthcare sector.

80% of companies globally are private  

Investors can invest in private as well as public equities. Some companies do not issue or trade shares publicly and remain privately owned. Private equity funds buy stakes in private companies and often take a role in running those businesses. They share in any profits from the business and also aim to make a profit by increasing the value of the company over time before selling it on.

While assets under management in private assets still represents less than 10% of all investable assets, and private equity specifically remains a fraction compared to listed equities, more than 80% of companies globally are held in private hands and need financing through private equity⁶. As a result, the financing of private entrepreneurship will continue to be vital for economic development and innovation.

And individual investors' interest in private equity is continuing to grow. The Eltif 2 label is expected to support the democratisation of private assets in Europe, with the creation of semi-liquid evergreen funds.

Of course, several issues need to be considered carefully. There’s liquidity for one: despite the emergence of semi-liquid funds, these investment strategies remain fundamentally illiquid and therefore not necessarily advisable to everyone directly – except, through pension schemes. Then there’s the cost: private equity products manufactured for private individuals are substantially more expensive than the ones for institutional investors.

However, for those individuals that understand the risks, the benefits of investing in private equity include diversification – providing a way to decorrelate an investment portfolio from the volatility of public markets – and potentially enhanced returns, where private equity has typically outperformed public stock markets over the longer term.