Geopolitical uncertainty reshaping investment strategies
21.10.2024 – Articles
PGIM’s 2024 Global Risk Report, based on the findings from a survey of 400 institutional investors managing $9trn in assets, underscores the need for resilient investing strategies in an increasingly unpredictable world.
The report outlines the challenging dilemma faced by investors; while mitigating risks in a volatile geopolitical environment, they must remain agile to capitalise on emerging opportunities. Common strategies include diversifying portfolios, stress-testing them for geopolitical scenarios, and seeking out sectors poised for growth in the evolving global trade landscape.
Key findings from the global analysis
Geopolitical risk takes top spot: Geopolitical risk has become the primary concern for institutional investors, with 56% identifying it as a top threat. Factors such as major wars, US-China tensions, and economic statecraft have amplified global instability, compelling investors to reconsider their strategies.
But investors recognise shocks can be short-lived: Recent geopolitical shocks, like the Russia-Ukraine war, have triggered short-lived market volatility rather than long-term disruptions.