Three key megatrends that could shape investing in 2025

Key investment ‘megatrends’ to watch out for in 2025? Geopolitical tensions/rising defence spending, energy demand and AI growth.

There are three key megatrends shaping the investment scene. Picture via Getty Images

• Three key megatrends are set to shape the 2025 investment scene

• Geopolitical tensions and defence spending rise

• Energy demand surges and AI is influencing markets

For investors aiming to get a head start in 2025, understanding the key themes that will shape the global economy is crucial.

According to deVere Group, one of the world’s largest independent advisory and asset management firms, three key megatrends are set to dominate the investment landscape in 2025:

Escalating global conflict, surging energy demand, and the rapid rise of artificial intelligence (AI).

Here’s how these powerful forces could affect markets and how Aussie investors can position themselves to benefit.

Geopolitical conflict

Geopolitical tensions are on the rise around the world.

Europe remains destabilised by ongoing conflicts, the Middle East is grappling with renewed unrest, and East Asia is facing increased territorial disputes. This growing instability is having a profound effect on global markets.

As Nigel Green, CEO of deVere Group, explained:

“Conflict, unfortunately, continues to be a driving force in global markets. According to the Institute for Economics & Peace, the global conflict index is at its highest point since World War II, with over 50 active armed conflicts globally.

“The financial ramifications of these tensions are profound.”

The result of this increasing conflict is a significant rise in defence spending.

For example, the US is projected to exceed US$1 trillion in defence spending in 2025, a figure that is expected to boost investments in advanced military technologies, missile systems, and cybersecurity.

“Defence budgets are ballooning… and investments are flowing into advanced military technologies, missile systems and cybersecurity – areas that are critical for national security.

“As AI-driven threats rise, companies providing digital defences will be major beneficiaries.

“Investors should be looking at how geopolitical risk can actually create long-term opportunities in this space.”

Surging energy demand

Energy consumption is reaching unprecedented levels, driven by several key factors: global economic growth, the electrification of transport, and the rise of AI.

One surprising beneficiary of this surge is nuclear energy, which is undergoing a renaissance despite previous concerns.

“The energy transition is at a critical juncture. Investors need to think beyond the traditional green-versus-fossil-fuel narrative,” said Green.

Nuclear energy has seen a resurgence, with many older plants being refurbished and new projects slowly progressing despite regulatory delays.

Often overlooked, it is now a crucial part of the energy mix. Companies with existing nuclear infrastructure are poised for substantial growth, he added.

This signals a promising future for companies with established nuclear infrastructure.

Also, offshore oil and gas exploration has picked up again, demonstrating that traditional energy sources still play a vital role in meeting global demand.

“Offshore oil and gas exploration is experiencing a revival, signalling confidence in long-term profitability.”

Artificial intelligence

AI continues to reshape industries worldwide, and its influence is expected to accelerate in 2025, said Green.

From automating tasks to transforming business models, AI is not just a passing trend – it’s an essential component of future economic growth.

“The companies building the infrastructure to support AI’s expansion will drive the next phase of market gains,” noted Green.

“This is a long-term play, and investors who position themselves now will benefit immensely.

"While there is always talk of bubbles, the reality is that AI’s transformative potential is only beginning to unfold.”

One of the key drivers of AI’s growth is the massive increase in capital expenditure on infrastructure.

Tech giants and emerging players are investing heavily in data centres, cloud computing, and hardware to support AI’s rapid development.

As more businesses integrate AI into their operations, the companies providing this essential infrastructure stand to see enormous growth.

Read more here: Why AI should be on the radar of every investor

“2025 will be a year of complexity and opportunity,” Green said. "We expect that conflict, energy, and AI are the investment megatrends that will define 2025."

"Now is the time to act.”

The views, information, or opinions expressed in this article are solely those of the interviewee and do not represent the views of Stockhead.

Stockhead has not provided, endorsed or otherwise assumed responsibility for any financial product advice contained in this article.

Originally published as Three key megatrends that could shape investing in 2025