As global markets evolve in late 2025, investors must broaden their horizons. This article uncovers key trends, risks, and strategies for those seeking cross-border portfolio and direct investment opportunities beyond traditional boundaries.

Macroeconomic Backdrop and Cross-Border Capital Flows

The International Monetary Fund projects global GDP growth at 3.0% in 2025, inching up to 3.1% in 2026. While advanced economies struggle to match pre-pandemic averages, emerging markets continue to attract significant international capital.

Foreign direct investment (FDI) flows fell 11% to $1.5 trillion in 2024, marking a second consecutive year of decline amid caution and uncertainty. Nevertheless, the United States remains the top destination, with inward FDI stock reaching $5.7 trillion—31% of the world’s total.

• Drivers of attractiveness include skilled labor, entrepreneurial culture, and deep capital markets.
• Emerging economies draw investors with higher growth prospects and urbanization.
• BRICS investment into the U.S. remains limited, under 2% of total inflows.

Trends in Asset Classes: From Private Markets to Real Estate

Global private markets have shown remarkable resilience, bolstered by higher-for-longer interest rates and investor demand for alternatives. Private equity deal activity rebounded, supported by accessible financing and an uptick in buyout lending.

Private debt remains robust as institutions seek security in a structurally elevated rate environment. Infrastructure deals rose 18% year-on-year, with nearly 46% of surveyed investors planning to increase allocations in this sector.

Real estate rebounded in 2024 with an 11% increase in deal value to $707 billion. Data centers delivered standout returns of 11.2%, reflecting the surge in digital infrastructure demand.

Key Quantitative Data (2024–2025)

Geographic Dynamics: Developed vs. Emerging Markets

The United States commands 31% of global inward FDI, led by sectors such as manufacturing ($2.4 trillion) and information technology. Software publishing jumped 150% over five years, while retail trade soared 55% to $213 billion.

Europe’s share of world FDI has declined from 33% in 2004 to 23% in 2024, as capital shifts to developing Asia and other emerging regions. China alone now accounts for 7% of global FDI stock, up from 2% two decades ago.

Developing countries collectively hold 31% of global FDI, driven by energy transition, logistics, and digital industries. Infrastructure demand, fueled by $33 trillion in global trade and rising electricity sales, underscores these markets’ appeal.

Transformative Sectors Driving Growth

Investors are targeting sectors at the intersection of technology and infrastructure, where generative AI and green energy converge. Opportunities include:

• Artificial intelligence and advanced software platforms.
• Renewable energy and energy transition assets.
• Data centers and digital infrastructure.
• Modern logistics and advanced manufacturing.

Scaling these industries requires operational expertise, as complexity and competition intensify.

Navigating Risks: Geopolitical, Economic, and Technological

Investors face a maze of risks: geopolitical tensions, regulatory shifts, economic fragmentation, and structural inflation. Supply chain realignments and currency volatility further complicate cross-border strategies.

Yet volatility can be a source of opportunity for those adept at active management. Focusing on resilient sectors and agile capital deployment helps mitigate these challenges.

Strategies for the Modern Global Investor

To thrive in this dynamic landscape, investors should adopt a multifaceted approach:

• Diversify across asset classes and geographies to balance risk and return.
• Prioritize active ownership and operational expertise in portfolio companies.
• Lean into transformative themes like AI, infrastructure, and green industries.
• Employ dynamic hedging and currency management to navigate volatility.

Combining thematic focus with robust risk management fosters long-term resilience.

Conclusion: Embracing a Borderless Investment Mindset

In late 2025, global investors must think beyond national borders to capture growth and manage risk. By aligning capital with transformative sectors—supported by resilience of private markets and strategic diversification—investment opportunities abound worldwide.

Adopting an agile, informed, and thematic approach empowers investors to navigate uncertainties and unlock value across developed and emerging markets alike.