Top Takeaways from NYLI’s 2025 Global Investor Forum

This year’s forum explored how investors can navigate a shifting global investment landscape shaped by inflation volatility, technology disruption, and geopolitical re-alignment. Though the risk of a global slowdown was present in conversations, investors’ tone was forward-looking and solution-oriented, reflecting deep expertise across asset classes.

The Global Market Strategy team was heavily represented in the week’s events, with presentations on the macro backdrop, asset allocation, geopolitics, and megatrends all given mainstage visibility.

A few key themes emerged:

1. A new global regime is taking shape. Investors are rethinking volatility, portfolio construction, and cross-border risk. While recent U.S. policy changes have added to market uncertainty, many of the drivers—re-globalization of supply chains, digitization (e.g., AI), energy security, and geopolitics—were already in motion. This evolving backdrop is shifting expectations around asset performance and risk.

Along these lines, investors admitted that they were still grappling with how – and how much – to incorporate the increased frequency of geopolitical events in their portfolios. Higher costs, including a cost of higher currency hedging were a concern. Our approach includes adding and diversifying various exposures to assume an increased likelihood of geopolitical events. Just as important: the structural change discussed above makes it more likely, in our view, that geopolitical events have longer-lasting impacts on macroeconomic and market conditions. To this end: we’ll be watching Israel’s attack on Iran closely for signs of contagion.

2. Interest rates are expected to be higher, more volatile, and regionally divergent. Many investors expect U.S. rates to remain elevated as the Federal Reserve navigates inflationary pressures, including tariff-related risks. In contrast, Europe is in a clearer rate-cutting cycle, creating opportunities across equities, credit, and real estate.

3. GMS’ deep dive on debt sustainability really struck a chord. We’ve all seen concerns about high debt levels and rising debt burdens among developed-market governments; and in the United States, long-held questions of U.S. competitiveness and the U.S. dollar are top of mind. It’s true that governments are facing a new balance of spending priorities: aging populations may require more social and healthcare spending, while economic resilience is resulting in more spending on digital infrastructure, supply chain redundancy, and climate resilience. But the reality for investors is that debt is sustainable as long as there is demand for what is issued. Shifts in factors such as policy credibility, interest burden affordability, and spending quality play a role in the return investors expect for holding government debt – and those shifts may continue to create interest rate volatility on the margin.

4. Investors are doubling down on diversification: With more uncertainty in capital market assumptions, portfolio rebalancing was a central theme. Diversification is being pursued across multiple dimensions:

• Geography: while U.S. assets remain core, rising political risk is prompting more attention to geographic allocation, especially ex-U.S.. Ex-U.S. investors are already seeing a meaningful shift in allocation from this marginal change in mindset.
• Sources of return: Investors are emphasizing income generation to buffer against volatility. High yield, asset-backed, and private credit opportunities were top of mind.  
• Size: In the private markets, investors favored the lower middle market for its historical resilience and differentiated deal flow compared to mega-cap strategies.

5. Investors are working harder (and more creatively) to find quality. Senior leaders from our parent company, New York Life Insurance, emphasized the importance of portfolio resilience over prediction. In an uncertain world, identifying quality securities within each asset class can enhance risk-adjusted returns. This aligns with our view that high-quality names in traditionally riskier spaces (e.g., high-yield or private credit) can be powerful diversifiers.

6. Innovation is already reshaping capital allocation. Artificial intelligence is catalyzing investment across foundational layers (semiconductors, data structures) and infrastructure (energy supply and maintenance). Internally, New York Life is using AI to streamline research, underwriting, and client engagement—highlighting its dual role as both an operational advantage and a high-conviction, cross-asset investment opportunity. Across sectors, infrastructure and healthcare stood out. Investors are especially focused on breakthroughs in obesity, oncology, and rare diseases, though healthcare remains underweighted in many indices.

The forum closed with a clear message: We are entering a capital markets era defined by innovation, differentiation, and adaptability. Investors who “wait and see” how capital markets trends play out may be left behind in this period of structural transition.