Four reasons to consider exposure to active global equities

“See the world” is advice often dispensed by seasoned travellers who know the benefits of experiencing different cultures, locations, and perspectives. When it comes to investing, “go global” is similarly sound advice for the multiple benefits a global approach can deliver.

1. Access to a much broader set of opportunities

Global investors play on a much bigger field. Across the world, there are more than 58,000 publicly listed companies. That far surpasses the number of public firms in any country or even a broad region such as the Eurozone or Asia-Pacific. Active investors can fully explore the opportunities in markets around the world because they, unlike passive strategies, are not limited to owning the companies included in major benchmarks.

Active managers can also be more discerning. Passive managers must own every company in the relevant index, regardless of each company’s current circumstances. Active managers conduct in-depth research to find the companies they believe offer the greatest promise—and avoid those whose prospects are more limited or even declining.

2. A borderless approach with no geographic limitations

Global investors don’t put borders around their opportunities. That can make good sense because over the multi-decade time horizons many investors have, no single country is likely to have a monopoly on long-term performance leadership. Of course, the US market may seem like the exception to that rule because US stocks have been on a 17-year bull run that only the COVID-19 pandemic could temporarily interrupt.

Watch the video below to see Alex Tedder, CIO Equities, explain why active global equities can form a valuable part of portfolios:

Still, it’s important to note that the extraordinary US market performance came from only a handful of mega-cap stocks, known as the “Magnificent Seven”, which are mostly in the technology sector. Absent those stocks, other equity markets, such as Europe, have delivered returns comparable with the US. For investors who might be concerned about their portfolios now being overly concentrated in such a small group of US stocks, a global strategy can provide much-needed diversification.

Even though globalisation was a multi-decade trend, we still don’t have a one-world economy. In recent years, that trend has shifted in the opposite direction towards deglobalisation. The supply-chain disruptions that occurred during the pandemic accelerated this transition, as more companies looked to establish vendor relationships with firms in their home country or nearby. The heightened tariffs imposed by the second Trump administration also brought a realignment of global trade partnerships.

All these changes have increased the potential benefits of not having any geographic limitations on your portfolio. Given that different factors drive the economies of different markets and regions, a global investor can enjoy all the usual benefits of diversification. They have exposure to markets that may be performing well in a particular global climate and boosting returns, while also offsetting exposure to markets that might be facing challenges.

Equity market leadership is not static

Past performance is not a guide to future performance and may not be repeated. Europe = Europe ex UK. Source: LSEG Datastream, MSCI and Schroders. Data to 10 March 2026 in US dollars.

3. Freedom to go where the greatest growth potential is

Simply put, the US technology sector is not the only game in town. Other sectors, such as health care and energy, also have promising long-term growth stories.

A portfolio that invests in both developed and developing markets can also take part in the higher growth potential of emerging markets, which have less mature economies than their developed-market counterparts, and that translates into higher growth prospects. All the trends in these countries—such as increased urbanisation and a growing middle class—are creating significant opportunities for the companies that serve these customers.

For investors, though, growth doesn’t have to come just from expanding economies and increasing profit margins. Growth can also come from substantial increases in companies’ share prices. On this front, global investors have advantages as well. In certain markets, such as the US, share valuations are elevated. Even as companies greatly increase their earnings, the multiples investors pay for those earnings have been extraordinarily high relative to their history. An active global manager can find markets, sectors, and companies where valuations are less elevated—and the opportunities for growth through share price appreciation could be higher.

4. More opportunities to mitigate risk in periods of extreme volatility

On many fronts, stock markets were full of good news for investors in recent years. The reign of US tech stocks delivered considerable returns not only for US equity portfolios but also for global equity strategies that have US market exposure. In 2025, other markets also asserted themselves, as regions such as Europe and Asia-Pacific posted better returns overall than the US equity market did.

Still, amid all the encouraging developments, short-term circumstances—such as tariff announcements, shifting sentiments about the impact of AI, and major geopolitical events such as US/Israeli attacks on Iran—can bring significant market disruptions.

Global active managers have multiple options to mitigate the risks these disruptions bring. As noted, global managers can invest across geographies in both developed and emerging markets. They can also adjust their allocations to sectors and are not limited, as passive strategies are, to the sector weights of a particular index. Depending on the portfolio mandate, they may also have the flexibility to invest across large- and small-cap companies and to tilt towards different styles such as value or growth. With that flexibility, managers can maintain exposure to whichever segments are most in favour in different market scenarios. When markets are turbulent, it helps to have a full array of choices to limit the impact of downturns.

Important Information

Marketing material for professional clients only.

Investment involves risk.

Any reference to regions/countries/sectors/stocks/securities is for illustrative purposes only and not a recommendation to buy or sell any financial instruments or adopt a specific investment strategy.

Reliance should not be placed on any views or information in the material when taking individual investment and/or strategic decisions.

The material is not intended to provide, and should not be relied on for, accounting, legal or tax advice, or investment recommendations.

Past Performance is not a guide to future performance and may not be repeated.

The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. Exchange rate changes may cause the value of investments to fall as well as rise.

Schroders has expressed its own views and opinions in this document and these may change.

Information herein is believed to be reliable but Schroders does not warrant its completeness or accuracy.

The data contained in this document has been sourced by Schroders and should be independently verified.

Third party data is owned or licensed by the data provider and may not be reproduced, extracted or used for any other purpose without the data provider’s consent.

Neither Schroders, nor the data provider, will have any liability in connection with the third-party data.

This document may contain ‘forward-looking’ information, such as forecasts or projections. Please note that any such information is not a guarantee of any future performance and there is no assurance that any forecast or projection will be realised.

This material has not been reviewed by any regulator.

Not all strategies are available in all jurisdictions.

For readers in Argentina: Schroder Investment Management S.A., Ing. Enrique Butty 220, Piso 12, C1001AFB – Buenos Aires, Argentina. Registered/Company Number 15. Registered as Distributor of Investment Funds with the CNV (Comisión Nacional de Valores).

For readers in Australia: Issued by Schroder Investment Management Australia Limited Level 20, Angel Place, 123 Pitt Street, Sydney NSW 2000 Australia ABN 22 000 443 274, AFSL 226473. It is intended for Professional Investors and financial advisers only and is not suitable for Retail Clients.

For readers in Brazil: Schroder Investment Management Brasil Ltda., Rua Joaquim Floriano, 100 – cj. 142 Itaim Bibi, São Paulo, 04534-000 Brasil. Registered/Company Number 92.886.662/0001-29. Authorised as an asset manager by the Securities and Exchange Commission of Brazil/Comissão de Valores Mobiliários (‘CVM’) according to the Declaratory Act number 6816. This document is intended for Professional Investors only as defined by the CVM rules which can be accessed from their website www.cvm.gov.br.

For readers in Canada: Schroder Investment Management North America Inc., 7 Bryant Park, New York, NY 10018-3706. NRD Number 12130. Registered as a Portfolio Manager with the Ontario Securities Commission, Alberta Securities Commission, the British Columbia Securities Commission, the Manitoba Securities Commission, the Nova Scotia Securities Commission, the Saskatchewan Securities Commission and the (Quebec) Autorité des marchés financiers.

For readers in Hong Kong S.A.R.: Issued by Schroder Investment Management (Hong Kong) Limited. Level 33, Two Pacific Place, 88 Queensway, Hong Kong. This material has not been reviewed by the Securities and Futures Commission of Hong Kong.

For readers in Israel: Note regarding the Marketing material for Qualified Clients and Sophisticated Investors only. This communication has been prepared by certain personnel of Schroder Investment Management (Europe) S.A (Registered No. B 37.799) or its subsidiaries or affiliates (collectively, ‘SIM’). Such personnel are not licensed nor insured under the Regulation of Investment Advice, Investment Marketing and Investment Portfolio Management Law, 1995 (the ‘Investment Advice Law’). This communication is directed at persons (i) who are Sophisticated Investors as listed in the First Schedule of the Israel Securities Law (ii) Qualified Clients (‘Lakoach Kashir’) as such term is defined in the Investment Advice Law; and (iii) other persons to whom it may otherwise lawfully be communicated. No other person should act on the contents or access the products or transactions discussed in this communication. In particular, this communication is not intended for retail clients and SIM will not make such products or transactions available to retail clients.

For readers in Japan: Issued by Schroder Investment Management (Japan) Limited, A Financial Instruments Business Operator, Kanto Local Finance Bureau (FIBO) No. 90, Member of Investment Management Association of Japan and Type 2 Financial Instruments Firms Association.

For readers in Malaysia: This presentation has not been approved by the Securities Commission Malaysia which takes no responsibility for its contents. No offer to the public to purchase any fund will be made in Malaysia and this presentation is intended to be read for information only and must not be passed to, issued to, or shown to the public generally. Schroder Investment Management (Singapore) Ltd does not have any intention to solicit you for any investment or subscription in any fund and any such solicitation or marketing will be made by an entity permitted by applicable laws and regulations.

For readers in Mauritius: This document is intended only for Sophisticated Investors who may receive it in compliance with applicable laws and regulations. This document is not intended to be a financial promotion and should not be construed as a solicitation of financial services or products in Mauritius. This document is not an advertisement for the purposes of The Guidelines for Advertising and Marketing of Financial Products in Mauritius. Issued by Schroder Investment Management Limited, located in Office 506, Level 5, Precinct Building 5, Dubai International Financial Centre, PO Box 506612 Dubai, United Arab Emirates. Regulated by the Dubai Financial Services Authority. This document is not subject to any form of approval by the DFSA. Accordingly, the DFSA has not approved any associated documents nor taken any steps to verify the information and has no responsibility for it.

For readers in New Zealand: This material is provided for information purposes only. It is intended only for Wholesale Investors and is not suitable for Retail Investors. The issuer does not hold any license issued by the Financial Markets Authority and is not registered under the Financial Services Providers (Registration and Dispute Resolution) Act 2008.

For readers in Singapore: This document is intended for Accredited and/or Institutional Clients only. Issued by Schroder Investment Management (Singapore) Ltd (Co. Reg. No. 199201080H) 138 Market Street #23-01 CapitaGreen, Singapore 048946. This document has not been reviewed by the Monetary Authority of Singapore.

For readers in South Africa: For professional investors and advisers only. Not suitable for retail clients. Issued by Schroders Investment Management Ltd registration number: 01893220 (Incorporated in England and Wales) is authorised and regulated in the UK by the Financial Conduct Authority and an authorised financial services provider in South Africa FSP No: 48998.

For readers in South Korea:

For Qualified Professional Investors (QPIs) only. This document is provided for information purpose only and does not constitute any solicitation or offering of investment products. These investment products are not protected by Depositor Protection Laws, and neither party provides any guarantee of principal or investment performance. Investment involves risk, including the potential for partial or total loss (0~100%) of principal due to market volatility and other factors. Investors are solely responsible for any investment losses. Exchange rate fluctuations may affect the value of overseas investments, potentially resulting in principal loss. Past performance and forecasts are not indicative of future results. Additional fees and expenses, such as transaction costs, may apply. Investors have the right to receive a full explanation of these investment products from their distributor. It is imperative that investors carefully read the relevant offering documents, which provide details on investment objectives, risks, redemption procedures, fees, and other important matters, before making an investment decision.

For readers in Switzerland: Marketing material for Professional Clients and Qualified Investors only. This document has been issued by Schroder Investment Management (Switzerland) AG, Talstrasse 11, CH-8001 Zurich, Switzerland, a fund management company authorised and supervised by the Swiss Financial Market Supervisory Authority FINMA, Laupenstrasse 27, CH-3003 Bern.

For readers in Taiwan: Issued by Schroder Investment Management (Taiwan) Limited 9F., No. 108, Sec. 5, Xinyi Road, Xinyi District, Taipei 11047, Taiwan. Tel +886 2 2722-1868. Schroder Investment Management (Taiwan) Limited is independently operated. This material has not been reviewed by the regulators.

For readers in Thailand: This presentation has not been approved by the Securities and Exchange Commission which takes no responsibility for its contents. No offer to the public to purchase any fund will be made in Thailand and this presentation is intended to be read for information only, and must not be passed to, issued to, or shown to the public generally. Schroder Investment Management (Singapore) Ltd does not have any intention to solicit you for any investment or subscription in any fund and any such solicitation or marketing will be made by an entity permitted by applicable laws and regulations.

For readers in the European Union/European Economic Area: Issued by Schroder Investment Management (Europe) S.A., 5, rue Höhenhof, L-1736 Senningerberg, Luxembourg. Registered No. B 37.799.

For readers in the Middle East: This document is intended only for professional investors who may receive it in compliance with applicable laws and regulations. This document is not intended for any professional investors in any jurisdiction where it is not permitted in accordance with applicable laws or regulations. Professional investors are as defined by laws and regulations applicable in each jurisdiction and may be defined as sophisticated investors. This document is not intended to be a financial promotion. Issued by Schroder Investment Management Limited, located in Office 506, Level 5, Precinct Building 5, Dubai International Financial Centre, PO Box 506612 Dubai, United Arab Emirates. Regulated by the Dubai Financial Services Authority. This document is not subject to any form of approval by the DFSA. Accordingly, the DFSA has not approved any associated documents nor taken any steps to verify the information and has no responsibility for it.

For readers in the United Kingdom: Issued by Schroder Investment Management Limited, 1 London Wall Place, London EC2Y 5AU. Registered Number 1893220 England. Authorised and regulated by the Financial Conduct Authority.

For readers in the United States: For financial professionals and consultants only. Schroder Investment Management North America Inc., 7 Bryant Park, New York NY 10018-3706. CRD Number 105820. Registered as an investment adviser with the US Securities and Exchange Commission.

Schroders will be a data controller in respect of your personal data. For information on how Schroders might process your personal data, please view our Privacy Policy available at https://www.schroders.com/en/global/individual/footer/privacy-statement/ or on request should you not have access to this webpage.

For your security, communications may be recorded or monitored.