Freedom24 analysis: the most important challenges and opportunities of the fall

Main trends influencing investor behavior

Retail demand for equities is rising, with Wall Street forecasts suggesting it could reach $500 billion in 2025. Importantly, this growth appears rational and balanced – not driven by the “fear of missing out” (FOMO). Traditional equities are outperforming cryptocurrencies, while fintech applications are encouraging more disciplined investing and boosting demand for money market funds, which balance safety and yield.

The global equity market is outperforming: non-U.S. equities rose by 11.2% in the first half of 2025, largely thanks to strong performance in Europe and Japan. At the same time, a 10% decline in the dollar index has made foreign assets more attractive. U.S. equities appear overvalued, trading at a price-to-earnings ratio of 22, prompting investors to look abroad for better risk/return profiles.

Younger generations are reshaping investment habits. More than 30% of Gen Z begin investing before graduating, and 86% are financially literate by the time they enter the workforce. They prefer digital tools, short-term goals and thematic strategies, accelerating structural changes in investor behavior.

Inflation has reshaped investor psychology. Four in ten investors fear losses, and one in five avoid certain instruments altogether. Many seek quick gains in equities, derivatives and crypto – trading stability for speed, leaving their portfolios more vulnerable.

Key challenges: uncertainty as the new normal

Despite growth prospects, risks remain significant. Inflation, trade conflicts and geopolitical tensions continue to create a challenging decision-making environment.

40 percent of investors fear losses, while volatility undermines adherence to long-term strategies. Import tariffs remain close to 15% despite mitigation measures, and difficult negotiations with China and the UK could significantly affect export-driven sectors.

Geopolitical conflict in the Middle East adds further volatility, prompting a reassessment of commodity market risks. Meanwhile, U.S. market overvaluation limits growth potential and may accelerate capital outflows to more attractive regions.

Traditional indicators – such as inflation expectations and fiscal discipline – are becoming less reliable. Investors must adapt to a “new normal,” where politics and geopolitics move markets faster than economic data.

“The autumn 2025 strategy should be based on broad diversification, inflation-protected assets and disciplined equity selection, combined with geographic diversification. The current environment favors investors willing to combine thematic ideas, digital tools and thoughtful risk management. Clear objectives, deliberate asset allocation and strengthened portfolio management infrastructure may be the key elements in turning the uncertainty of the coming months into sustainable portfolio growth.”

– explained Radu-Iulian Pădurean, Freedom24’s Network Development Manager.

Investment guide for September–December 2025

Amid ongoing uncertainty, investors must align their strategies with regional risks, structural shifts and their own financial maturity. The following steps can strengthen portfolio resilience:

Geographic and factor diversification: A “balanced multipolarity” model is recommended, combining U.S. growth equities with Japanese cyclical assets and undervalued European sectors. Selective exposure to India, the United Arab Emirates and Mexico may also offset currency risks and enhance returns.

Balancing protection and yield in bonds: A laddered strategy in U.S. Treasuries (from 6 months to 5 years) is suggested to exploit the yield curve. In addition, allocation to investment-grade corporate bonds (10–15%) and high-yield or private credit instruments (up to 5%) may improve returns, provided that contractual risks are carefully monitored.

Disciplined bets on secular trends: ETF-based investments in areas such as artificial intelligence, green metals and biotechnology offer thematic opportunities. To avoid excessive concentration, each theme should account for no more than 5% of the overall portfolio.