June 18, 2025

Asset Allocation Insights - June 2025

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Quarterly report

Macro decoupling increases diversification opportunities amid sustained volatility. Increased role for Fixed Income, Alternatives and International (ex US) Equities.

Key highlights:

  • Macro backdrop conducive to high volatility and dispersion
  • Equity market leadership shifts: Developed Europe shines, while the US underperforms
  • Greater role for fixed income in multi-asset portfolios
  • Alternatives: Listed infrastructure and commodities (mainly gold) highly accretive in portfolios
  • Tailwinds for emerging markets (EM)
  • The US dollar no longer the safe-haven; currency hedging became more important
  • Macro decoupling leads to increased diversification opportunities

Published quarterly, this report covers:

  • Key macroeconomic influences and their implications for financial markets
  • Core drivers across asset classes – and what they are indicating
  • Cross-asset analysis – expectations, risk premiums, return and risk, correlations and more · Implications for asset allocation and portfolio construction
  • Market analysis provided exclusively via our indices, and LSEG and Lipper fund flows data – enabling apples-to-apples comparisons across asset classes and global markets

To support your investment decision-making, we produce specialist content that provides analysis and insights on a range of investment topics. Go to our hub for valuable Market Insights.

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