Why the next phase of global investing may go beyond the US, says Alekh Yadav of Sanctum Wealth

After years of US equity market outperformance driven by Big Tech and the AI boom, global investors are entering a phase where returns may no longer be as one-sided.

While recent geopolitical tensions, including developments in Venezuela, have so far had a limited direct impact on US markets, they underscore the growing role of volatility and macro risks.

According to Alekh Yadav, Head of Investment Products at Sanctum Wealth, valuations in marquee US stocks appear stretched, even as risks are building around debt-funded capex, circular financing, and AI revenue growth lagging investment.


With the US economy also facing headwinds from a slowing labour market and sticky inflation, Yadav believes the next phase of global investing may require investors to look beyond the US and diversify international exposure more meaningfully. Edited Excerpts -

Q) Could a potential US military operation in Venezuela impact US financial markets, and how might this affect the portfolios of investors with exposure to US assets?
A) The US military operation in Venezuela turned out to be very targeted and limited and hence the initial impact on US financial markets appears to be limited.

The situation in Venezuela is still uncertain with no clarity on how things will pan out, the level of US involvement etc.

Hence, for now, the impact is limited but volatility could be expected. This specific episode shouldn’t impact views of investors with the US exposure.

Q) Are there specific US sectors or companies that could come under pressure amid rising geopolitical tensions?
A) As noted, the immediate impact appears limited. A key factor to watch is the U.S. approach to Venezuelan oil reserves, which could affect U.S. oil companies—some may face headwinds, while others could benefit.

Q) As we look ahead to 2026, should investors consider adding to their existing US portfolios, or does the recent rally warrant some profit-booking?
A) U.S. equity markets have delivered a strong rally in recent years, driven by the Mag-7 and AI companies. We believe valuations in this segment are stretched.

While the AI-driven rally may continue, emerging risks include rising debt-funded capex, circular financing, and revenue growth for AI applications lagging the capex spending.

Additionally, the U.S. economy faces headwinds from a slowing labour market and inflation remaining above the Fed’s 3% target. We recommend that investors diversify their international exposure beyond U.S. equities.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)