These five super-trends will shape the future of investment
Credit Suisse has identified five super-trends as long-term themes that are expected to dominate in the coming years and provide investment opportunities
As investors wonder how to best handle high valuations of many assets, they automatically turn to thematic investments that can benefit from long-term societal trends.
The expectation is that such investments do not depend as much on the daily ups and downs of the financial markets, but seek to profit from the predictability and sustainability of multi-year trends. Demographics, transformational socioeconomic and political developments as well as technological and scientific progress are at their core.
● Angry societies – Multipolar world
Rising inequalities within Western countries and frustration over perceived or real failures of the political establishment to deal with current societal challenges are leading disenchanted middle-class voters to demand change. This brings to power governments with strong mandates for a policy more oriented to support the domestic economy, create jobs at home and address some of the pain points of the Western middle class.
The years of hyper-globalisation helped reduce inequalities across countries but raised inequalities within countries, leading to the social disenchantment that is now driving political change in many Western countries. Looking ahead, we expect a period characterised by economic policy that seeks to support domestic consumers and redistribute growth to sectors with high domestic employment. This will likely shift the spotlight to national champions and brands, defence and security and emerging-market consumers, areas we consider multi-year investment themes.
● Infrastructure – Closing the gap
A global wave of new infrastructure programmes has captured the attention of investors. From India to the United States, governments have turned to infrastructure spending as a means to stimulate domestic economic growth. We review the opportunities for investors as infrastructure spending programmes develop and gradually move our focus from transport infrastructure, which has been the first priority of many governments, to water, energy and affordable housing.
