Goldman Sachs Exchanges Mid-year outlook: diversify and hedge
54 snips
Jun 23, 2025 Christian Mueller-Glissmann leads asset allocation research at Goldman Sachs, while Alexandra Wilson-Elizondo co-heads the Multi-Asset Solutions Business. They discuss strategies for navigating market volatility and advocate for diversification instead of relying solely on U.S. tech stocks. The conversation highlights the risks facing European investors and the need for strategic hedging. They emphasize the importance of adapting portfolios to the evolving economic landscape, ensuring resilience amidst policy uncertainties and market challenges.
AI Snips
Chapters
Transcript
Episode notes
Diversification Over Timing Works
- Diversification has been effective this year, while market timing was challenging due to rapid market moves.
- The market surprise involved both sharp declines and quick recoveries amid tariff shocks and geopolitical risks.
Dollar and Bonds Defy Norms
- The dollar has not behaved as a traditional safe haven and the bond market's safe haven role is questionable due to size and liquidity.
- These unusual dynamics reflect rare convergence of structural, geopolitical, and macro tailwinds.
Rethinking FX and U.S. Assets
- Equity-bond selloffs together are not new but the rising FX risk contribution in portfolios is new and significant.
- Dollar volatility and its correlation with equities demand hedging and reconsideration of U.S. asset dominance in global portfolios.