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Emerging Markets Set to Outperform U.S. Stocks in 2025

12/5/2025

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Summary

Story summary

Cambridge Associates says emerging market stocks will outperform developed markets for the first time in five years, prompting investors to reduce U.S. equity exposure.
This year (2025), the U.S. dollar has fallen 10%, and Cambridge projects a decline in 2026 driven by economic policy uncertainty and overvalued assets.
In 2025, non-US equities outperformed US equities by 6.6 points locally and 13.9 points in dollars, with Latin America up 37% YTD.

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Story summary

Cambridge Associates says emerging market stocks will outperform developed markets for the first time in five years, prompting investors to reduce U.S. equity exposure.
This year (2025), the U.S. dollar has fallen 10%, and Cambridge projects a decline in 2026 driven by economic policy uncertainty and overvalued assets.
In 2025, non-US equities outperformed US equities by 6.6 points locally and 13.9 points in dollars, with Latin America up 37% YTD.