UBS 2025 global investment outlook

In a recent interview on CNBC Africa, Michael Bolliger, Chief Investment Officer: Emerging Markets at UBS Global Wealth Management, shared insights into the global investment outlook for 2025. Bolliger, who has been on the ground engaging with clients in various countries, highlighted the resilience and potential he sees in emerging markets like South Africa. Despite challenges such as budget negotiations and global trade tensions, Bolliger remains optimistic about the opportunities that lie ahead. One key theme that emerged from the interview is the importance of focusing on domestic reforms and execution in the face of external uncertainties. Bolliger emphasized the need for countries like South Africa to stay the course on reform processes, particularly in sectors like logistics, transportation, and electricity. By concentrating on what can be controlled internally, Bolliger believes emerging markets can weather external headwinds and attract investment. Three key points from the interview include: 1. Strategic Positioning in Emerging Markets: UBS has taken a bullish stance on South Africa, viewing it as a unique reform story within the broader emerging market landscape. Bolliger mentioned that soon after the new government came to power, UBS initiated an overweight position on South African shares as part of their emerging market equity strategy. While there have been some setbacks, Bolliger remains confident that the country is on track for more positive developments in the next six to 12 months. 2. Impact of Global Trade Tensions: The conversation also touched on the tariff announcements made by President Donald Trump and their implications for emerging markets, including South Africa. Bolliger acknowledged the potential for contagion effects but stressed that the fundamental economic outlook for South Africa remains resilient. He advised a focus on domestic reforms to mitigate external uncertainties and recommended aligning investment strategies with the evolving global trade landscape. 3. Balancing Risk and Opportunity in the Global Market: Looking ahead to 2025, Bolliger advocated for a strategic approach that combines investment and tradable opportunities. He suggested adopting a barbell strategy, where investors position for growth while incorporating downside protections within their portfolios. By maintaining an overweight position in equities while hedging against volatility, investors can navigate the evolving market dynamics and capitalize on risk assets. In conclusion, Bolliger's insights underscore the importance of adaptability and foresight in the ever-changing landscape of global investments. As uncertainties persist, leveraging domestic strengths, monitoring global developments, and implementing strategic risk management are key considerations for investors seeking to optimize their portfolios in the years to come.