RECENT market data is pointing to a shift in global capital flows, with US stock markets beginning to lag behind emerging markets, as international investors look to deploy funds in new regions offering stronger growth and more attractive valuations.

The trend is increasingly relevant for countries like Jamaica, as investors reassess concentration risk and look beyond traditional markets when allocating capital globally. The observations were highlighted by Robert Whelan, portfolio manager at NCB Cayman Limited, during an investment webinar titled Reset, Rebalance and Reposition. Using the S&P 500 as a benchmark for US market performance, he noted that while US equities have dominated returns over the past decade, particularly following the global financial crisis, emerging and international markets are now beginning to outperform, influencing how global investors are reallocating capital.

“A lot of people have gotten too heavy on their US exposures, so now is the time to maybe think about diversifying, and if you haven’t already, it’s definitely time to start thinking about it,” he advised investors.

For Jamaican investors with significant exposure to US assets, the shift highlights the growing role of international and emerging markets in portfolio diversification, and underscores the importance of how emerging economies position themselves as capital reallocates globally. Performance data for 2025 showed gold as the top-performing asset, rising 64 per cent. Among international equity markets, Canada and European exchange-traded funds (ETFs) gained 36 per cent, developed market ETFs and the United Kingdom rose 35 per cent, emerging markets advanced 34 per cent, and China gained 31 per cent. By contrast, major US indices, including the Nasdaq and the S&P 500, delivered returns below 20 per cent. In explaining the growing interest in emerging markets, Whelan pointed to valuation differences and growth dynamics, noting that many emerging markets are cheaper to invest in while offering faster growth and greater exposure to physical assets such as commodities and infrastructure. South America was highlighted as one region being closely monitored. Whelan said geopolitical considerations have also become more prominent in shaping investor interest, referencing long-standing US policy towards Latin America following World War II and increased activity by China in countries such as Brazil and Argentina. He noted that these dynamics are being assessed alongside global supply chain risks linked to artificial intelligence (AI). While AI remains a dominant long-term investment theme, Whelan said concentration risk remains, with advanced semiconductor manufacturing largely centred in Taiwan, off the coast of China.

“If you’re investing in the next couple of months, the key question is, ‘Does AI disrupt this business, and to what degree does it disrupt it?’” Whelan questioned.

He added that investment in the S&P 500 represents indirect exposure to the AI trade, given the weighting of technology stocks in the index, but said investors must assess how AI could affect individual companies and sectors differently. Short-term performance data also showed emerging markets gaining eight per cent between January and February 2026.

“If we look at this for the rest of the year, emerging markets and the rest of the world are going to do much better than the US,” he told investors.

Clean and green energy was also identified as another area being monitored by investors, despite continued focus by the US Government on fossil fuels.

“Sometimes you have to look in areas that are unloved and say, ‘Well, if I’m a long-term investor, where am I going to look that no one else is looking?’” he questioned.

He believes green energy will ultimately emerge as a winner, reinforcing the need for investors to avoid letting politics dictate portfolio decisions and instead focus on long-term structural trends shaping the global economy.

WHELAN…sometimes you have to look in areas that are unloved and say, ‘Well, if I’m a long-term investor, where am I going to look that no one else is looking?’.