Robeco logo

Disclaimer

BY CLICKING ON “I AGREE”, I DECLARE I AM A WHOLESALE CLIENT AS DEFINED IN THE CORPORATIONS ACT 2001.

What is a Wholesale Client?
A person or entity is a “wholesale client” if they satisfy the requirements of section 761G of the Corporations Act.
This commonly includes a person or entity:

  • who holds an Australian Financial Services License

  • who has or controls at least $10 million (and may include funds held by an associate or under a trust that the person manages)

  • that is a body regulated by APRA other than a trustee of:
    (i) a superannuation fund;
    (ii) an approved deposit fund;
    (iii) a pooled superannuation trust; or
    (iv) a public sector superannuation scheme.
    within the meaning of the Superannuation Industry (Supervision) Act 1993

  • that is a body registered under the Financial Corporations Act 1974.

  • that is a trustee of:
    (i) a superannuation fund; or
    (ii) an approved deposit fund; or
    (iii) a pooled superannuation trust; or
    (iv) a public sector superannuation scheme
    within the meaning of the Superannuation Industry (Supervision) Act 1993 and the fund, trust or scheme has net assets of at least $10 million.

  • that is a listed entity or a related body corporate of a listed entity

  • that is an exempt public authority

  • that is a body corporate, or an unincorporated body, that:
    (i) carries on a business of investment in financial products, interests in land or other investments; and
    (ii) for those purposes, invests funds received (directly or indirectly) following an offer or invitation to the public, within the meaning of section 82 of the Corporations Act 2001, the terms of which provided for the funds subscribed to be invested for those purposes.

  • that is a foreign entity which, if established or incorporated in Australia, would be covered by one of the preceding paragraphs.


I Disagree

09-05-2025 · Insight

Targeting alpha in a global trade revolution

The trade war started by the new US government has prompted a severe stock market sell-off as economic confidence recedes amid uncertainty over the re-organization of complex global supply chains. This paradigm shift in trading conditions requires a more balanced global equity allocation to both developed and emerging markets.

    Authors

  • Kees Verbaas - Global Head of Fundamental Equity

    Kees Verbaas

    Global Head of Fundamental Equity

Summary

  1. US exceptionalism is in question, even if Trump’s trade war is contained

  2. Long-term alpha generation will demand a more global footprint

  3. Rebalancing away from US assets and USD weakness will bolster EM

Rebalancing away from the US will accelerate

‘Liberation day’ on 2 April has had two impacts which will be enduring. First, US exceptionalism took a serious blow, with the imposition of sweeping global tariffs certain to drive US inflation, weaken the US economy and make it more difficult for leading US multinationals to operate globally. Second, the impact on the global economy ex-US will be deflationary, with lower demand and overcapacity in some sectors likely to manifest itself rapidly, with negative short-to-medium-term macroeconomic aftershocks.

At the time of President Trump’s inauguration, US equity market dominance had reached its zenith with the US accounting for 64% of the MSCI All World Index while the country accounts for 15.5% of global GDP in 2024.1

Figure 1: MSCI World is dominated by US companies

Figure 1: MSCI World is dominated by US companies

Source: MSCI. The MSCI ACWI captures large- and mid-cap representation across 23 developed markets (DM) and 24 emerging markets (EM) countries. With 2,558 constituents, the index covers approximately 85% of the global investable equity opportunity set.

Valuations also reflected this dominance, with the US CAPE ratio on 31 March 2025 at 32.8, compared to an average of 19 for developed markets (DM) and an average of 14 for emerging markets (EM).2 This US valuation premium seems certain to narrow as the US rewrites the rules of global competition.T

Read the complete insight and get our analysis of where to invest in this new global trading landscape.

Download the full paper


Footnotes

1Source: Statista based on a Purchasing Power Parity measure of estimated 2024 GDP.
21Q25 Global Valuations – The Idea Farm - 8 April 2025. The CAPE ratio (cyclically adjusted price-to-earnings ratio), assesses whether the market is overvalued or undervalued by comparing current prices to average earnings over a 10-year period, adjusted for inflation.

Get the latest insights

Subscribe to our newsletter for investment updates and expert analysis.

Read more
Robeco

Robeco aims to enable its clients to achieve their financial and sustainability goals by providing superior investment returns and solutions.

Important information: This website is prepared and issued in Australia by Robeco Hong Kong Limited (ARBN 156 512 659) (‘Robeco’) which is exempt from the requirement to hold an Australian financial services licence under the Corporations Act 2001 (Cth) pursuant to ASIC Class Order 03/1103. Robeco is regulated by the Securities and Futures Commission under the laws of Hong Kong and those laws may differ from Australian laws. The information on this web page is provided to you because Robeco reasonably believes that you are a "wholesale client" within the meaning of that term under section 761G(4) of the Corporations Act 2001 (Cth) ("Corporations Act") and not any other class of persons. This information is not an advertisement and is not intended to induce retail clients to acquire Robeco products. Retail clients who are interested in Robeco products should contact their financial adviser.