In light of growing global uncertainties, investors are being urged to reassess their portfolios, with a significant recommendation from Ashika Global Family Office Services: reduce exposure to US tech stocks and allocate more funds toward gold. The firm, which specializes in personalized investment strategies for high-net-worth individuals and global family offices, suggests that gold remains an effective hedge against inflationary pressures and currency risks.
While advising caution in the US technology sector, Ashika Global remains optimistic about Indian equities, particularly large-cap stocks and select high-growth mid-cap opportunities. The firm also highlights the current overvaluation in the US tech space, warning that these stocks could face substantial corrections in the coming months as their inflated valuations come under scrutiny.
India: The Most Undervalued Economy in the World?
Ashika Global has positioned India as one of the strongest and most undervalued economies in the world. With a stock market capitalization of $5.6 trillion, India now ranks as the fourth-largest equity market globally. The country’s economy continues to grow at a robust 7% GDP growth rate for FY 2024-25, supported by more than 6,000 listed companies and 9 million small and medium-sized enterprises (SMEs).
Indian companies have demonstrated impressive market resilience, raising $40 billion from capital markets in 2024 alone, a testament to strong investor confidence. Moreover, India remains a major recipient of foreign remittances, with $124 billion in inward remittances recorded in 2024, further reinforcing its economic strength.
Despite these impressive fundamentals, Ashika Global points out that global credit rating agencies have been slow to recognize India’s potential, continuing to assign the country a BBB- credit rating. Amit Jain, Co-Founder of Ashika Global, describes this stance as outdated and misaligned with India’s evolving economic reality.
Gold’s Rise as the New Global Safe Haven
The report from Ashika Global highlights a significant surge in both gold and real estate prices, which have increased by between 80% and 150% since 2020. This growth supports the firm’s long-term optimistic outlook. The rise in gold holdings by central banks around the world is particularly noteworthy, as many nations have shifted away from US Treasuries in favor of gold, pushing global gold reserves to a 30-year high.
This shift is a clear sign of growing distrust in fiat currencies, with some experts suggesting that a new global monetary system—possibly involving gold-backed currencies—could be on the horizon. The increasing interest in gold as a store of value reflects this shift in global financial power.
US Economy Faces Rising Debt and Market Risks
Ashika Global also draws attention to the increasingly precarious financial situation of the United States. The federal debt has now surpassed $36 trillion, growing by an alarming $4 trillion in just over a year. Projections indicate that by 2025, nearly 28% of all US government revenue will be allocated to interest payments, raising serious concerns about the long-term sustainability of the country’s fiscal policy.
Stock market valuations in the US are also reaching extreme levels. The Nasdaq-100, for instance, is trading at a Price-to-Earnings (P/E) ratio of 34, implying an earnings yield of around 2.9%. This suggests that investors are treating the tech-heavy index as a safer bet than US government bonds, a trend that Ashika Global finds fundamentally illogical. Furthermore, nearly 45% of companies in the Russell 2000 index remain unprofitable, revealing the fragile state of the broader US equity market.
Compounding these concerns is the decreasing foreign ownership of US Treasuries, which has fallen to a two-decade low, signaling growing skepticism from global investors regarding the stability of the US economy.
The Global Shift Away from the US Dollar
A significant shift in global financial power is also underway, with many countries moving away from reliance on the US dollar. Since 2019, China has reduced its holdings of US Treasury securities by 40%, signaling a broader diversification strategy. This trend, known as “de-dollarization,” has been gaining traction, as countries seek alternatives to conducting international trade without depending on the dollar.
The rise of the Petro-Yuan, a potential competitor to the Petro-Dollar, could further accelerate this transition. China’s increasing share of Saudi Arabia’s oil exports—now at 30%, compared to just 5% by the US—adds credibility to the notion of a new oil trade settlement system, potentially backed by gold. The US’s controversial decision to freeze $300 billion in Russian reserves following the Ukraine conflict has further alarmed countries, prompting them to reconsider their exposure to dollar-denominated assets.
Conclusion
In conclusion, Ashika Global’s 2025 investment outlook emphasizes the need for a shift in strategy, urging investors to prioritize gold and consider undervalued Indian equities while exercising caution in the US tech sector. As global financial dynamics evolve, these recommendations reflect the growing importance of diversifying away from traditional assets, such as the US dollar and US Treasuries, toward more stable and tangible stores of value like gold.
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