Geopolitics, AI, and Sustainable Innovation: The Key Takeaways After Davos

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The 2026 edition of the Davos Forum closed with images, speeches, and agreements that help shape the new global order in which investors and asset managers will have to navigate. “This is a time of uncertainty, but also of possibility; it is not a time to pull back, but to lean in. The World Economic Forum is not about reacting to the moment. It is about creating the right conditions for us to move forward,” stated Børge Brende, President and CEO of the World Economic Forum, at the closing of the event.

In this context, and during his speech, Larry Fink, Interim Co-Chair of the World Economic Forum and CEO of BlackRock, argued that economic progress must be shared. “We believe prosperity needs to go further than it has gone, and we believe institutions like the World Economic Forum remain important to make that happen,” he stated.

Indeed, the theme of this edition, which emphasized dialogue, appeared to have tempered the tone of U.S. President Donald Trump. “He claimed to have held constructive talks on Greenland with the NATO Secretary General and canceled the planned tariff hikes set for February 1. At the same time, a meeting between the United States, Ukraine, and Russia was scheduled to address peace in Ukraine, a signal of geopolitical de-escalation that helped risk assets rebound. Gold pulled back but approached the $5,000 mark again this week,” summarized Edmond de Rothschild Asset Management.

Beyond the speeches and broader goals of Davos, markets experienced a week marked by geopolitical noise and volatility, yet equity indexes barely corrected as corporate earnings continued to support valuations. In response to these risks and uncertainty, investors moved toward safe-haven assets, particularly gold. But what are the key messages from Davos that truly matter for the industry?

Fragmentation, Risk, and Geopolitics

According to investment firms, a context of growing fragmentation and geoeconomic conflict has become increasingly evident, seen in trade, sanctions, and supply chains. In this sense, the Davos agreement on Greenland is a clear example of this fracture.

“Investors continue to seek protection for their portfolios, as tensions in global alliances and unresolved risks keep uncertainty levels high. With central banks increasing their gold purchases over the past year and a macroeconomic environment that continues to support accumulation of the asset, we foresee further price gains,” stated Mark Haefele, Chief Investment Officer at UBS Global Wealth Management.

For Thomas Mucha, Geopolitical Strategist at Wellington Management, geopolitical cycles tend to be long, historically lasting between 80 and 100 years. “Structural changes like the ones we are witnessing occur only once per century and tend to be disruptive. Therefore, while market risk is structurally higher in this new regime, 2026 will still offer ongoing opportunities to identify winners and losers within portfolios,” he noted.

Given the high probability that this shift toward national security will persist for years, Mucha believes 2026 could be a good moment to increase exposure to long-term investment themes across both public and private markets. “These themes include: defense and military tech innovation (e.g., artificial intelligence, space and aerospace technologies); critical minerals and rare earths; biotechnology; cyber defense; and renewable energy and climate resilience strategies. This dynamic plays out regionally, nationally, by sector, and at the company level, as well as across all asset classes. It naturally favors active management, as it allows for more agile risk mitigation and differentiation than a passive approach. Opportunities for alpha could emerge through long/short and other alternative strategies. In any case, prudent investors should incorporate geopolitical perspective into their portfolio strategy for 2026 and beyond,” the expert emphasized.

Focus on AI

Another major theme was artificial intelligence, which was present in most of the leaders’ discussions. In Davos, a repeated idea was that the core challenges are trust, governance, and alignment, while warnings were issued regarding job displacement and uneven distribution of productivity gains. The narrative is shifting from “adopt AI” to “prove value and control.”

For asset managers, approaching opportunities in AI goes beyond the spotlight on the Magnificent Seven. “The expansion of AI infrastructure, increased defense spending, and strong demand in the aerospace industry are creating structural tailwinds for the sector. On top of that, greater AI adoption in industrial processes is already showing improvements in productivity and operational efficiency. Looking ahead to 2026, a more favorable macroeconomic environment could boost cyclical segments of the sector and broaden opportunities beyond the large tech firms,” stated Principal Asset Management.

Echoing Davos sentiments, AI-related infrastructure is considered a solid opportunity for investors. “The growing infrastructure needs associated with AI, particularly the construction of data centers, are creating investment opportunities beyond the tech sector. Industrial companies in construction and engineering, electrical equipment, and construction machinery (making up roughly 22% of the sector) supply key components for data centers, from electrical design to cooling systems and battery storage. Some estimates suggest global investment in data centers could reach $7 trillion by 2030 to meet rising energy demands, largely driven by AI workloads,” noted Principal AM.

Sustainable Innovation

As concluded at the Davos Forum, AI and emerging technologies are fundamentally transforming all industrial sectors and the global labor market, driving profound changes in skill requirements and entire professions across both advanced and emerging economies. “When a proven technology like AI merges with emerging fields such as quantum computing or synthetic biology, ideas move from lab to market faster, shaping how industries grow and unlocking new ways to improve the world around us,” they noted. “I would advocate for developing countries: build your infrastructure, engage with AI, and recognize that AI is likely to close the technology gap,” said Jensen Huang, founder, president, and CEO of Nvidia.

The Forum advocated for the responsible and equitable use of technologies like AI, stressing the need to balance their potential with associated risks. Industry leaders encouraged peers to draw lessons from history to guide the deployment of AI. To meet future energy needs, it was emphasized that technology must scale, grids must be modernized, and access to innovation must expand. A new report on clean fuels suggests that global investment in clean fuels could rise from around $25 billion today to over $100 billion annually by 2030, driven by new demand and government ambitions.

Abundant Capital, Limited Growth: The Keys to Mexico’s Economic Stagnation

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Mexico main supplier US
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Mexico shines in international financial markets: its proximity to the world’s largest financial center, Wall Street, and its status as an emerging market have made it a magnet for capital. However, the country’s economic growth trend has been raising red flags for some time. It seems as if there are two Mexicos: one of investments, and another of the real economy.

Portfolio Investment (PI) reached a historic level last year, and the peso is one of the strongest and most stable currencies in the world, buoyed by carry trade. Everything related to financial investments in the country points to a historic moment. But there is a deeply concerning structural problem: the economy is not growing, or is doing so at insufficient rates.

This stark contrast worries analysts and investors, particularly because it’s not a new scenario, and the available data shows no significant shift in the country’s economic growth trend. The worst part, according to some analysts who spoke with Funds Society, is that it appears to be a structural issue.

Productivity: One of the Warning Signs

“It’s hard to pinpoint a single reason why our economy isn’t growing. It’s definitely not something specific to this administration or the ruling party, it’s a structural issue. In my view, a lot of it has to do with productivity. Most growth factors are in place: consumer demand is solid, investment follows its cycles,” said Luis Gonzali, Co-Director of Investments at Franklin Templeton Mexico. “Once you strip away those factors, what remains is productivity, and this indicator has been declining steadily, unlike what we see in other global economies,” he added.

“That residual factor economists call productivity has been steadily falling in Mexico. And because it’s residual, it’s difficult to identify a clear cause for this deterioration. But if we focus specifically on the past two years, investment clearly stands out as a major determinant of low growth. Investment has essentially flatlined; a rebound is expected this year, which could push GDP growth to a maximum of 1.5%. That might seem like a favorable increase compared to the 0.3% the Mexican economy may have grown in 2025, but it’s well below its maximum potential rate of 2.5%, and far short of the 5% to 7% needed to make a real economic leap,” he explained in an interview.

A Golden Investment

For Gonzali, there’s no doubt Mexico is one of the top investment destinations in the world. The numbers speak for themselves. At the end of the first quarter last year, Portfolio Investment reached $496.09 billion, almost ten times more than the $49 billion recorded during the same period in 2020.

The appeal of interest rates, which peaked at a nominal 11% in the Mexican financial market after the pandemic, has been one of the biggest draws, creating a phenomenon known as carry trade, investments arriving from around the world, including markets previously unfamiliar with Mexico such as Japan, aiming to benefit from higher interest rates.

The Portfolio Investment figure largely explains another phenomenon: the “super peso,” which in 2025 appreciated by nearly 15%, its strongest performance since the free-floating exchange rate regime was established, following the traumatic December 21, 1994 devaluation.

Even Foreign Direct Investment (FDI), which does not necessarily reflect the allure of financial investments, reached historic levels last year, totaling around $61 billion. However, over 50% of that figure came from reinvestments, meaning funds that were already in the country.

The peso, the stock market, and interest rate performance all reflect a country that’s highly attractive to investors, and the investment data confirms it. This isn’t the first time Mexico has acted as a capital magnet, but the current moment is undeniably one of the most significant in decades.

Investment: A Key Cause

For Gabriela Siller, Director of Analysis at Banco Base, the reason Mexico’s economy isn’t growing as it should lies in the “uncertainty trap,” which has pushed the country into a vicious cycle it hasn’t escaped in decades.

“Uncertainty drags down fixed investment and formal job creation. Without formal employment and fixed investment, productivity and long-term growth are limited. For example, through October 2025, fixed investment in the country fell by 7%. With that number, Mexico won’t even be able to grow at 2% in the long term, potential growth drops to 1.4%, and we don’t expect to even hit that rate this year. Fixed investment also has a degree of inertia. No one wants to invest in the private sector, and in the public sector, it would require unlocking investment through higher public spending on physical infrastructure, but in 2025 this indicator fell 29%, the steepest decline since 1995. It’s a tough scenario, even though public spending is set to increase by 12% this year,” said the economist.

“With this investment outlook, if we’re lucky, growth over the next few years will be around 1.4%, below the historical potential of 2.5%,” she explained.

Within that context, while financial strength is undeniable, Siller warns about the volatility of these capital flows, a recurring theme in Mexico’s history.

“We’re seeing unprecedented strength in the peso, and it’s directly tied to carry trade, there’s no doubt about it. These are hot money flows. Investors aren’t concerned about the country’s GDP, they care about returns, good rates, and getting paid. As long as that remains attractive, the trend will continue. For now, capital is downplaying risks such as the USMCA or judicial reform,” she emphasized.

Still, Siller remains pessimistic about Mexico’s growth outlook. She doesn’t expect significant expansion in the coming years and believes that these financial investments driven by carry trade could even become a major risk if perceptions of country risk change.

Reforms for Growth: The Only Option

“We’re on the verge of another lost six-year term in terms of economic growth,” Julio Ruiz, Chief Economist at Citi Mexico, told Funds Society.

According to his data, the average growth rate in the first half of this administration would be around 0.5%, well below the economy’s potential of 2% to 2.5%. Beyond that, the average in the second half would need to rebound dramatically to suggest a different trajectory, but neither official projections nor private forecasts expect that.

For Ruiz, the key to escaping Mexico’s “growth trap” is clear: “It’s definitely a structural issue. Mexico is almost certain to post another six-year term of growth well below its potential, between 2% and 2.5%, and far short of the 5% to 7% it would need to make a real economic leap, which would also have to be sustained for decades. Therefore, the only way forward is major structural reforms to generate that momentum. Otherwise, it looks extremely difficult,” he warned.

The 5% Growth: Just Political Rhetoric

For those interviewed, talk of GDP growth rates of 5% or higher is nothing more than political rhetoric.

“In the previous administration, when they promised GDP growth rates of 5% or even 7%, it was purely political speech. It wasn’t even backed by official data, we never saw anything like that in the budget proposals from the Finance Ministry. We only heard it in presidential statements. It was purely political rhetoric, with no connection to reality,” said Luis Gonzali.

In this way, while the causes of Mexico’s low growth may vary depending on the expert consulted, there is strong consensus that the country faces a structural problem, one that requires deep reforms and could take years to yield results. In the meantime, all signs point to yet another decade of sluggish economic growth for this global investment giant.

CV Advisors Hires Hailey Gordon as Portfolio Manager

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Photo courtesyHailey Gordon, New Portfolio Manager at CV Advisors.

CV Advisors has announced the appointment of Hailey Gordon as Portfolio Manager. In her new role, she will work closely with Elliot Dornbusch, Founder, CEO, and Chief Investment Officer of the firm, to develop and implement investment views and will be part of the firm’s Investment Committee.

According to the multi-family office, her responsibilities will span both client advisory and the firm’s research and investment team. She will oversee investment management for a select group of client families, including portfolio construction, asset allocation, and manager selection.

The firm highlights that Gordon brings extensive experience in global macro investing and client advisory, including six years at Bridgewater Associates, the world’s largest hedge fund, founded by Ray Dalio. At Bridgewater, she served as an investor and advised institutional clients on investment management. In this role, she worked directly with major sovereign wealth funds and public pension plans on portfolio construction, macroeconomic analysis, and asset and manager selection.

Prior to Bridgewater, Gordon held roles in the investment banking division of Barclays, specializing in interest rate and currency derivatives solutions. She earned dual bachelor’s degrees in Business Administration and Economics from the University of North Carolina at Chapel Hill, graduating with highest honors and being elected to Phi Beta Kappa.

“The appointment of Hailey marks a major milestone for CV Advisors, as it reflects the continued institutionalization and next generation of investment leadership at our firm. Her macro perspective, portfolio construction expertise, and track record advising some of the world’s most sophisticated institutional investors will be invaluable as we continue to deepen our research capabilities and strengthen our investment platform for the benefit of our client families,” said Elliot Dornbusch, Founder, CEO, and Chief Investment Officer of the firm.

Following her appointment, Hailey Gordon, Portfolio Manager, stated:
“CV Advisors is building something truly distinctive for sophisticated, high-net-worth families—combining the rigor of institutional investing with the customization of a single-family office. I’m excited to join a team that merges innovative technology with a deeply client-centric investment approach.”

CV Advisors notes that Gordon’s addition is “another example of the wave of talent moving from Wall Street to South Florida, contributing to the region’s growing reputation as a key hub for financial and investment talent.”

Janus Henderson Acquires Richard Bernstein Advisors

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New corporate move in the industry. Janus Henderson has signed a definitive agreement to acquire 100% of Richard Bernstein Advisors (RBA), a research-driven multi-asset macro investment manager. According to the firm, the acquisition positions Janus Henderson as a leading provider of model portfolios and separately managed accounts (SMAs). The transaction is expected to close in the second quarter of 2026.

Founded in 2009 by Richard Bernstein and headquartered in New York City, RBA is an asset manager focused on longer-term investment strategies that combine top-down macroeconomic analysis with portfolio construction based on quantitative models, and oversees approximately 20 billion dollars in client assets.

“Widely recognized as an expert and thought leader in style investing and asset allocation, Richard Bernstein has over 40 years of experience on Wall Street, including as Chief Investment Strategist at Merrill Lynch & Co.,” the firm states.

RBA offers its clients differentiated asset allocation solutions supported by the firm’s intellectual capital.

As part of the transaction, Richard Bernstein will join Janus Henderson as Global Head of Macro & Customized Investing, and will sign a multi-year agreement with the Company to lead the next phase of growth for RBA.

Key points of the deal

This acquisition will allow Janus Henderson to significantly strengthen its position in model portfolios and SMAs. Upon completion of the transaction, Janus Henderson will be among the top 10 model portfolio providers in North America, placing it at the forefront of a segment with strong growth prospects. In addition, RBA’s broad experience in distributing model portfolios and SMAs will allow Janus Henderson to enhance its distribution capabilities, including those targeting wirehouses and Registered Investment Advisors (RIAs).

“As demand for model portfolios and SMAs continues to accelerate across the industry, we are very pleased to announce this strategic acquisition of RBA, which will allow us to expand our investment capabilities for our clients, enhancing our current offerings in model portfolios and SMAs. Richard and his investment team are recognized for their research expertise, proven investment strategies, and innovative top-down macro approach. We believe that the investment and distribution capabilities of both RBA and Janus Henderson are a winning combination and position Janus Henderson for long-term success and market leadership in model portfolios and SMAs,” said Ali Dibadj, CEO of Janus Henderson.

For his part, Richard Bernstein, CEO and CIO of Richard Bernstein Advisors, added:
“We are thrilled to join Janus Henderson in this new stage of RBA’s evolution. Our shared approach, deeply rooted in research, the mindset of putting the client first, our strength in active ETFs and product innovation, as well as our distribution capabilities, will allow us to develop customized models and expand our reach among clients. We will remain committed to offering our clients our industry-leading intellectual capital and market perspectives. Our macro investment approach will complement Janus Henderson’s bottom-up fundamental investment strategies, expanding our combined capabilities for the benefit of our clients.”

iMGP sells its stake to Janus Henderson

In parallel with this transaction, iM Global Partner (iMGP) has announced that it will sell its stake in Richard Bernstein Advisors (RBA) to Janus Henderson, as part of the acquisition of 100% of RBA. Following this announcement, Philippe Couvrecelle, Founder and CEO of iM Global Partner, stated:
“Our mission has always been clear: to identify top boutique managers, partner with them to grow, and offer high-quality investment solutions to clients around the world. The acquisition of RBA by Janus Henderson is a very positive outcome for the firm and for clients, and a clear proof of our strength in identifying leading investment boutiques, as well as the value our partnership platform can create for our asset manager partners.”

Couvrecelle emphasized that iM Global Partner is a growing company. “We already have ambitious plans to accelerate our long-term expansion, and this transaction provides additional momentum to capitalize on our expertise in partner selection, forge new relationships, and further advance our growth strategy in Europe, the United States, and Asia,” he added.

For his part, Richard Bernstein, CEO and CIO of the firm, noted that iM Global Partner has been an excellent and highly supportive partner for RBA over the past five years. “Everyone at RBA is deeply grateful for iMGP’s help in driving our growth, and we wish them the greatest success in their future projects,” he said.

Trump’s Geopolitical Approach Opens the Door to a Narrowing of Spreads in Latin American Fixed Income

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After taking some distance from the first weeks of January, experts agree that the arrest of Nicolás Maduro by the United States has had a significant geopolitical and financial impact. Although the focus remains on the oil and gold markets, some firms are also observing possible consequences for Latin American fixed income markets.

“The U.S. operation in Venezuela marks a decisive moment for Latin America, with implications for fixed income investors. While the possibility of increased U.S. intervention introduces new risks, it also creates opportunities by potentially becoming a source of reduced political risk premiums. Our base case is that greater U.S. engagement will support reform momentum in Colombia, Brazil, and Mexico, strengthening the fundamentals in favor of local LatAm bonds,” say analysts at JP Morgan AM.

According to the asset manager’s view, for fixed income investors, these events are a double-edged sword. “On the one hand, increased U.S. engagement leading to more orthodox governments from an economic standpoint could accelerate reform momentum in some countries, improving governance and fiscal discipline. On the other hand, the risk of political backlash or unintended consequences remains high, especially in markets with fragile institutions or entrenched political movements. Even so, we believe the fundamental case for increasing exposure to certain Latin American bonds has strengthened. Countries likely to benefit from U.S. support, or where reform prospects improve, should see a reduction in risk premiums, while those more exposed to economic policy uncertainty could continue to lag behind other emerging market regions,” they add from JP Morgan AM.

Implication for Investors

Historically, as Salman Ahmed, Head of Global Macro and Strategic Asset Allocation at Fidelity International, recalls, when extreme risks, such as a prolonged conflict, dissipate, sovereign debt in default or under stress in emerging markets tends to rebound on expectations of regime change, sanctions relief, and eventual restructuring. Therefore, he sees it likely that “a similar pattern will occur this time, with early signs that the regime is willing to cooperate with the United States, which could further boost bond prices.”

One must not forget the specific characteristics of the Latin American debt market. Michael Strobaek, Global Chief Investment Officer at Lombard Odier, explains that while emerging market equity indices are largely dominated by China, dollar-denominated bond indices include a greater proportion of Latin American debt securities. Therefore, he expects, following the arrest of Maduro, “a greater compression of spreads in emerging market bonds, as the growth of these economies remains supported while short-term U.S. yields continue to decline.”

However, not all Latin American debt would move in unison in the face of this new geopolitical shock. In this regard, Mirabaud makes it clear that in emerging debt, the current situation in Venezuela will bring “greater differentiation between countries with solid fundamentals and extreme idiosyncratic situations.” Specifically, Venezuela’s sovereign and quasi-sovereign debt “remains in default,” the firm notes, stating that the profile of this asset “remains problematic and dependent on events.” In addition to being subject “to a clearly defined political and legal process.” The firm also refers to Colombian debt, “indirectly exposed due to its geographic proximity.” Here, the firm considers it “possible” that short-term volatility will occur, “without this posing an immediate challenge to its strong macro-financial fundamentals.”

But there is the possibility of Venezuela’s return to international debt markets. If it happens, Christian Schulz, Chief Economist at Allianz GI, states that it is possible that “sovereign spreads of neighboring countries could narrow as stability improves.” He also believes that distressed debt investors may find opportunities in bonds issued by the Venezuelan state or by Petróleos de Venezuela (PDVSA). Alex Veroude, Head of Fixed Income at Janus Henderson, expresses a similar view, stating that in the short term, “Venezuelan bonds could receive initial support, as markets price in the prospect of policy normalization.”

Less External Influence

According to Capital Group, it is important to remember that emerging market debt denominated in local currency is increasingly determined by domestic interest rates, reflecting structural changes taking place in the composition of markets and policy frameworks. “The lower participation of foreign investors has reduced external influence, allowing the monetary policy of the respective countries to play a dominant role in price setting. This trend shift has been supported by monetary and fiscal credibility, the greater depth of capital markets, and the rise of institutional investment, which provides stable demand even in markets that previously relied heavily on foreign financing,” they explain.

Currently, central banks in many emerging markets are already well advanced in their respective rate-cutting cycles and, although a slowdown in the pace of cuts is expected in 2026, the cycle is not yet over, and the room for further cuts will vary significantly between regions. “The yield premium offered by local currency emerging market debt remains attractive, which can provide protection against bouts of volatility and an appealing level of income even in a context of declining global yields. Investor exposure to local currency emerging market debt has been steadily recovering after several years of capital outflows, supported by improved fundamentals and the attractive level of real yield. Nonetheless, it remains below pre-pandemic levels, creating a favorable technical backdrop for the asset class. Emerging market currencies could also contribute to returns, as some benefit from high U.S. dollar valuations and the narrowing of yield advantages,” they explain from Capital Group.

Mexico’s Tax Amnesty and U.S. Inheritance Taxes: 2026’s Key Tax Developments

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Pixabay CC0 Public DomainAuthor: Steve Buissinne from Pixabay

The start of 2026 brings tax regime changes in several countries, notably including a revision of the U.S. federal estate and gift tax exemption threshold and an offshore capital amnesty in Mexico

Greater Exposure to the Estate Tax

As of January 1, 2026, the United States has raised the threshold for the federal estate and gift tax following the enactment of the so-called One Big Beautiful Bill Act (OBBB Act), which modified federal exemptions. In 2026, the unified exemption stands at $15 million per individual, up from $13.99 million in 2025.

This threshold represents the total value of lifetime gifts and estate transfers a person can make without triggering federal estate or gift tax. Any amount exceeding the exemption is generally subject to a federal tax rate of up to 40%.

In addition, several tax cuts introduced in 2025 under the OBBB Act have been made permanent. These include lower income tax brackets and expanded deductions, such as an increased child tax credit of $2,200, as well as temporary special deductions for seniors, tips, auto loan interest, and overtime pay.

According to a report by Insight Trust, “High-net-worth families in the U.S. should immediately review their estate and gifting structures, as a greater number of heirs may now fall under estate tax liability with the lower exemption threshold. Strategies such as using trusts before death, life insurance, or planning tax residency are increasingly important tools for minimizing tax exposure.”

Mexico’s 2026 Capital Repatriation Program

Mexico’s Voluntary Capital Repatriation Program, coming into effect in 2026, allows taxpayers to regularize legally sourced capital held abroad before September 2025, provided the funds are brought into or returned to Mexico during the 2026 fiscal year. Both individuals and legal entities residing in Mexico, as well as non-residents with a permanent establishment in the country, may participate.

The program’s main incentive is a preferential 15% income tax rate, applied to the full amount of repatriated capital. This tax is final—no deductions, credits, or offsets are allowed—and payment fulfills all tax obligations related to the repatriated funds.

A central condition of the program is that the returned capital must not remain idle. The regulation requires that the funds be invested in Mexico and remain invested for a minimum of three years. Eligible investments include productive assets, business projects, permitted acquisitions, or authorized financial instruments, all subject to criteria established by the tax authority (SAT). Taxpayers must formally declare how the funds will be used and file a specific notice, along with the appropriate tax return for each repatriation transaction.

The regime also includes post-compliance limitations. For example, if the repatriated funds are used to pay dividends or profits before meeting the minimum investment term, additional income tax may apply under general tax rules. Failure to comply with any requirement, such as meeting the deadlines, maintaining the investment, or submitting proper notices, could result in the loss of tax benefits and the imposition of additional tax liabilities by the authorities.

Mexico previously implemented a similar repatriation program between 2016 and 2017 under the administration of Enrique Peña Nieto. At that time, approximately 380 billion Mexican pesos were returned, according to data from the Ministry of Finance, generating an estimated income tax revenue of between 20 and 25 billion pesos. When converted to U.S. dollars using the exchange rate as of January 21, 2026, the repatriated capital amounts to roughly $21.6 billion, with related tax revenues between $1.1 billion and $1.4 billion.

Deutsche Börse Group Announces the Acquisition of Allfunds

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Deutsche Börse Group and Allfunds Group have signed a binding agreement for the recommended acquisition of Allfunds, valued at €5.3 billion, according to a statement published by both companies. “The transaction, subject to obtaining the necessary approvals, is backed by a strong industrial logic and has the potential to create short-term value for all stakeholders of both companies,” the statement said.

“It represents an opportunity to create a top-tier global leader in fund services, combining Allfunds’ strength in distribution with Deutsche Börse Group’s custody and settlement capabilities. Allfunds and Deutsche Börse Group are highly complementary businesses in terms of geographic presence, product portfolios, and partner and client base,” it added.

Under the terms of the deal, Allfunds shareholders will receive €8.80 per share, made up of €6.00 in cash, €2.60 in Deutsche Börse Group shares, and a cash dividend of up to €0.20 per share for the 2025 financial year.

The offer represents a 32.5% premium over the closing share price on November 26, 2025, and a 40.5% premium over the volume-weighted average price for the three-month period ending on that same date.

Allfunds’ Board of Directors unanimously supports the transaction and intends to recommend that shareholders vote in favor of it. The acquisition is expected to close in the first half of 2027.

“In its 25-year history, Allfunds has democratized access to investment funds globally, profoundly transforming the wealth management industry. Today, we are a leading distribution and intermediation platform connecting distributors and asset managers across 66 countries. Our ability to innovate—from alternative funds to blockchain—combined with deep technical expertise and exceptional client service, has made Allfunds what it is today,” said Annabel Spring, CEO of Allfunds.

For his part, Stephan Leithner, CEO of DBAG, stated: “We are pleased to announce the acquisition of Allfunds, which comes with the unanimous recommendation of its board and the support of its two largest shareholders. We believe that combining the technical expertise and entrepreneurial drive of Allfunds Group with Deutsche Börse Group’s capabilities in Clearstream Fund Services will create a market-leading company that better meets client needs and supports the continued development of the fund industry in Europe and worldwide. This acquisition represents the next step in Deutsche Börse Group’s development as a European leader in providing critical infrastructure for financial markets.”

The joint statement from the two firms offers some insight into how the operations will be integrated: “The integration of DBAG and Allfunds will focus on consolidating the strengths of each business, including distribution and custody solutions, unifying both companies’ offerings to deliver streamlined and efficient services to clients. DBAG’s initial in-depth review of Allfunds has identified priority areas for integration, subject to appropriate consultation and planning, with the aim of eliminating duplication and fostering greater collaboration across the combined group. In assessing systems and operational setups, DBAG aims to retain the most effective solutions from both organizations.”

DBAG is a German public limited company (Aktiengesellschaft) incorporated under German law and is the parent company of the DBAG Group. It is one of the world’s largest providers of infrastructure for the trading of financial instruments. The DBAG Group offers clients a wide range of products and services covering the entire value chain of financial market transactions: from ESG business, indices, and software solutions, to post-trade services, transaction clearing and settlement, securities custody, liquidity and collateral management services, and market data provision.

With over 16,000 employees, the DBAG Group is headquartered in the Frankfurt/Rhein-Main financial center and maintains a strong global presence in locations such as Luxembourg, Prague, Cork, London, Copenhagen, New York, Chicago, Hong Kong, Singapore, Beijing, Tokyo, and Sydney.

Allfunds is a global trading and distribution platform in the wealth management sector. It has a long track record of growth, with net assets reaching a record high of €1.7 trillion as of September 30, 2025.

Allfunds connects more than 1,400 fund partners and over 900 distributors across 66 countries. The company operates 17 offices in major financial centers across four continents, including Bogotá, Dubai, Hong Kong, London, Luxembourg, Madrid, Miami, Milan, Paris, Santiago, São Paulo, Shanghai, Singapore, Stockholm, Valencia, Warsaw, and Zurich.

With over 1,000 employees, Allfunds is a public limited company incorporated under the laws of England and Wales.

Alpha Won’t Save You Anymore: Why Many Asset Managers Are Going to Become Irrelevant

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The debate is no longer whether securitization is a valid tool, but which asset managers are prepared to use it in a world that has changed its rules. The current environment, marked by structurally higher interest rates, persistent geopolitical tensions, and a much more demanding investor, is penalizing asset managers who continue trying to scale strategies with outdated structures.

Today, the biggest mistake an asset manager can make isn’t being wrong about an investment thesis but insisting on formats that no longer match the market’s reality. The message from the latest Morningstar 2026 Global Outlook is clear: uncertainty is not a one-time event; it’s the new starting point.

In this context, generating a good investment idea is not enough. If that strategy cannot be distributed efficiently, provide liquidity, meet institutional standards, and adapt to various regulatory frameworks, it simply becomes uncompetitive. This is where securitization stops being a technical solution and becomes a strategic advantage.

For asset managers, securitizing means separating alpha from operational friction. It allows converting both liquid and illiquid strategies into listed, tradable, and transparent vehicles. In an environment of recurring volatility, access to intraday liquidity and secondary markets is no longer a “value-added”: it’s a basic requirement.

The reality is uncomfortable for many traditional managers. Institutional investors and private banks are no longer willing to take on illiquid structures, manual processes, or vehicles that are difficult to explain to regulators. They seek products with ISINs, clear valuations, broker access, and a robust governance framework. Securitization precisely meets this demand.

Morningstar also warns that many supposedly “diversified” portfolios are actually exposed to the same risks: extreme concentration, demanding valuations, and liquidity dependent on sentiment. Meanwhile, private assets continue to grow, but their access is still limited by operational friction, high costs, and opaque structures. As the report points out, the problem is not the asset: it’s the format.

This is where securitization stops being a technical tool and becomes a strategic decision. Transforming liquid or alternative assets into listed, liquid vehicles with institutional standards allows asset managers to meet three key demands of today’s market: flexibility, risk control, and global access.

According to The Business Research Company, the global market for asset-backed securities surpassed USD 2.4 trillion in 2024 and is projected to continue growing at an annual rate of 6% in the coming years. Beyond the size, this data reflects a structural shift in institutional capital toward securitized instruments in response to the need for more stable income, real diversification, and more efficient structures in an interest rate volatility environment.

 

This growth is not a search for yield, but a shift in priorities. For many asset managers, securitized strategies provide access to cash flows tied to the real economy, with less reliance on individual issuers and a better ability to manage duration, credit risk, and liquidity compared to traditional fixed-income alternatives. In this regard, Janus Henderson has pointed out that securitized assets are gaining weight in institutional portfolios for their ability to offer recurring income and greater resilience in scenarios of high-interest rate volatility, relying on diversified portfolios of thousands of underlying assets.

Ignoring this reality comes at a cost. Investors, increasingly informed and sensitive to liquidity and governance, are no longer willing to accept difficult-to-explain structures. They seek products with clear valuations, secondary market trading, and robust regulatory frameworks.

In this scenario, FlexFunds positions itself as a strategic partner for asset managers who want to stay relevant. Its model allows asset managers to repackage assets into listed vehicles (ETPs), ready for global distribution, without the manager needing to become a legal, operational, or regulatory expert. The focus returns to where it should be: portfolio management.

This approach is complemented by integration with solutions like Leverage Shares, a leader in leveraged ETPs in Europe, and Themes ETFs, a specialist in thematic ETFs in the United States, reflecting where the market is heading: liquid, listed vehicles designed to capture opportunities in an agile manner.

The conclusion is clear. From 2026 onward, the question won’t be who has the best investment idea, but who structured it to survive in an environment where uncertainty is no longer the exception, but the norm. Securitization is not a trend: it’s the new standard, and asset managers who don’t integrate it into their business model won’t be defending their identity: they’ll be giving up their future.

If you want to explore how to scale investment strategies in today’s environment, contact the FlexFunds expert team at info@flexfunds.com and discover how to repackage multiple asset classes into listed, liquid, and globally distributable vehicles.

Oil Oversupply May Offset Uncertainty Around Iran and Venezuela

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The geopolitical risk premium on oil is likely to remain limited due to the oversupply in the global market, despite increased oil price volatility, according to Fitch Ratings.

Any potential supply disruption in Iran can be absorbed by an oversupplied market. OPEC’s future strategic stance, volume versus value, will be key in shaping the oil market.

“Our Brent oil price estimate for 2026 is $63/bbl, while our ratings for oil and gas companies focus on credit metrics based on our mid-cycle price of $60/bbl,” the agency’s note states.

The global oil market will remain oversupplied in 2026. Fitch estimates a supply increase of 3 million barrels per day (MMbpd) in 2025, and forecasts an additional increase of 2.5 MMbpd in 2026, while demand is expected to grow by only about 0.8 MMbpd annually.

Oil production from non-OPEC+ countries accounts for 55% and 48% of these increases, respectively, driven by the United States, Canada, Brazil, Guyana, and Argentina, according to the International Energy Agency. Fitch expects some moderation in non-OPEC+ production growth in 2027.

U.S. oil producers need a WTI price between $61 and $70 per barrel to drill a new well profitably, according to the Dallas Federal Reserve Energy Survey.

Data on Venezuela’s Production

Venezuela holds 17% of global proven reserves, the largest oil resource base in the world, but accounted for just 0.8% of global crude output in November 2025. Venezuelan oil production has declined sharply over the past 15 years, from 2.5 million barrels per day (bpd) in 2010 to 0.88 million bpd in 2024, due to sanctions and lack of investment. Output hovered around 1 million bpd between September and October 2025, but fell to 0.86 million bpd in November 2025 amid renewed sanctions and tensions with the United States. Oil exports dropped to 0.67 million bpd.

The sale of stored crude in Venezuela, both floating and onshore, and the lifting of sanctions could temporarily boost oil production to around 1 million bpd. However, this is unlikely to have a significant impact on the global market.

Venezuela Faces Structural Challenges to Boost Oil Output

Venezuela will face significant challenges in raising production by 1 to 1.5 million barrels per day (MMbpd), which could allow a long-term return to its 2010 output level of 2.5 million bpd. Achieving this would require substantial investment to modernize the country’s deteriorated infrastructure. Most of Venezuela’s reserves are extra-heavy/sour crude, the production of which demands advanced technical expertise typically provided by major international oil companies. Renewed investment from U.S. and other foreign oil firms would depend on a reliable regulatory framework and fiscal stability in the sector, especially given the expropriation of U.S. oil company assets in 2007.

Iran and Russia’s Position in the Global Market

Iran remains a significantly larger oil supplier globally, with production at 3.5 million bpd and exports of approximately 2 million bpd. Iranian crude supply has remained relatively stable despite tighter U.S. sanctions (in its November sanctions, the Office of Foreign Assets Control targeted a network of Iranian trading and shipping companies). Major disruptions to Iranian oil production would push prices higher, although the overall impact would likely be limited due to the current global supply surplus.

Russia’s oil production remains virtually unchanged at 9.3 million bpd under sanctions, with most exports redirected to China and India. Recently imposed U.S. and U.K. sanctions on Russian oil companies Lukoil and Rosneft could reduce Russian oil exports, as these producers account for around 50% of total exports. Conversely, a peace agreement between Russia and Ukraine and the lifting of sanctions would likely have a limited short-term impact on Russian volumes but could increase price volatility in an already oversupplied market.

OPEC+ spare capacity, estimated at 4 million bpd, will support the market in the event of supply disruptions. OPEC’s strategy and its balance between price support and market share retention will remain a key factor for the oil market, particularly in the face of potential disruptions or rising supply from non-OPEC countries.

Focused, Victorious, and Dominating Equities: This Is How ETFs Performed in the United States

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The year 2025 will have been a series of upward flow headlines for ETFs in the United States and, when looking at the consolidated data, the record high announced in the latest ETFGI report will come as no surprise. The breakdown by asset class confirms the trend: passive management is prevailing in equities. A third conclusion also stands out—the extreme concentration of the sector, dominated by three major brands: iShares (BlackRock), Vanguard, and State Street.

A Historic Year

The year 2025 was exceptional for the exchange-traded fund (ETF) industry in the United States, marking record highs in both assets under management and net capital inflows. ETFs in the U.S. attracted a total of $1.50 trillion in net inflows during 2025, driving total assets to $13.43 trillion by the end of December 2025, a record high for the U.S. industry.

Growth in Assets and Net Inflows in 2025

The most notable figure in the report is that during 2025, investors contributed $1.50 trillion in net inflows to the U.S. ETF sector, an unprecedented figure in the historical series. Monthly net inflows also showed strong and sustained momentum, with $223 billion in December 2025 alone. This flow continues a long-standing trend of capital accumulation by institutional and retail investors into exchange-traded funds.

As a result of these significant capital inflows, total assets under management by ETFs in the U.S. reached $13.43 trillion at the end of December 2025, far exceeding the $10.35 trillion recorded at the end of 2024. This growth represents a year-over-year increase of nearly 28% in assets under management, indicating a strong investor preference for the flexibility, cost-efficiency, and liquidity that ETFs offer compared to traditional investment vehicles.

This phenomenon is not isolated: other ETFGI reports show that the global ETF industry also experienced rapid growth in assets and flows in 2025, reaching record levels of over $19 trillion by the end of November, with more than 78 consecutive months of positive net inflows.

Main Segments and Types of ETFs

A key aspect of the expansion of the U.S. market in 2025 was the differentiated contribution of ETF types.

Equity ETFs were the ones that attracted the most flows, with $149.00 billion in December 2025 alone, bringing annual flows to $656.095 billion. This demonstrates continued investor preference for diversified exposure to U.S. and global equities, according to the report.

Fixed income also saw positive inflows, with $23.079 billion in December and a total of $258.014 billion in 2025. This reflects investor interest in lower-risk instruments or risk-adjusted returns amid equity market volatility.

Commodity ETFs, though more modest compared to equities and bonds, captured $9.033 billion in December, and their cumulative flows rose significantly compared to the previous year.

A notable trend this year was the growth of actively managed ETFs. These products attracted *$43.079 billion in December alone, totaling $514.056 billion in 2025, well above figures from previous years. The increased adoption of active ETFs indicates that while passive management remains dominant, investors are willing to pay for more specialized strategies that seek higher risk-adjusted returns.

Main Providers and Market Concentration

The report also analyzes market share among the leading ETF providers in the United States. The data reveal a clear concentration among the sector’s leaders, with three firms controlling more than two-thirds of the U.S. ETF market:

iShares (BlackRock) remains the dominant provider with $3.99 trillion under management, representing approximately 29.7% of the total U.S. ETF market.

Vanguard follows closely with $3.86 trillion and a market share of 28.7%*, solidifying its position as one of the most influential managers of passive products.

State Street SPDR ETFs ranks third, with $1.83 trillion and a 13.7% market share.

Together, these three providers hold approximately 72.1%* of total ETF assets in the United States, while the remaining 457 issuers each represent less than 6%, highlighting the strong concentration of the U.S. ETF market in the hands of a few players.