Recently, JP Morgan and Morgan Stanley have both released their mid year investment strategy outlook for 2025, which is worth taking a look at. Overall, several points were discussed: one ️⃣ Trump 2.0: Risk and Opportunity Risk aspect: Tariffs are likely to increase, potentially reaching nearly 1% of GDP, which is the biggest trade reversal since the Cold War and a global supply chain restructuring. Opportunity meeting: Tax reform plans and relaxation of financial regulation may stimulate mergers and acquisitions, loans, and bank stock performance. In the next 12 months, we are likely to face high volatility and risk in the financial market, but it will not be a pure bearish trend. It may be beneficial for the "local economy" sectors such as energy and national defense. two ️⃣ Global perspective: The US dollar weakens, while Europe, Japan, and Hong Kong rebound The strong cycle of the US dollar may have peaked, and global funds are beginning to 'rebalance'. The combination of European fiscal expansion and deindustrialization policies, as well as Japan's policy to maintain stability, is expected to usher in a long-term opportunity for "relative performance improvement". This year is a rare year for non US markets, with overall investment returns higher than the US market (as shown in Figure 2). So in terms of investment, don't invest all in the US stock market anymore. Global allocation is a major trend, especially with the valuation advantage and policy driving force of Hang Seng in Japan and Europe. three ️⃣ Optimization of investment logic This year is a year of high volatility, and investment portfolios need to be "resilient": now it's not about fighting for the explosive power of a single asset, but about fighting for structural resilience. Inflation and growth risks coexist in both directions: asset portfolios need to balance downside protection and upside opportunities. • Opportunity asset types: Core Defense: Gold, Hedge Funds, Infrastructure Offensive assistance: structured stock notes, non-public credit Have you noticed a magical phenomenon that the optimization of this investment portfolio is similar to the "all-weather strategy" we wrote on our top tweet on January 1st at the beginning of the year. four ️⃣ AI is still full of opportunities, focus on the application side No one talks about AI? It's just an illusion: the trend of AI cost reduction and efficiency improvement continues, which benefits the technology sector, especially infrastructure and AI enterprise application products. As an emerging industrial revolution, AI is transforming the industrial and technological industries in a comprehensive and three-dimensional manner. Basically, all existing mid to high end industries can be transformed and upgraded, especially in the fields of finance and biotechnology. Focusing on high value-added fields, the penetration and optimization of AI into the industry, as well as the improvement of talent and efficiency, is the biggest opportunity and industrial revolution that AI brings to the industry. five ️⃣ Regarding Encryption, Bitcoin, and Gold JP Morgan's attitude is neutral and conservative: he believes that cryptocurrency assets have too much volatility and are still difficult to be a "stabilizer of investment portfolios" in the short term. He is more optimistic about the risk hedging effect of gold in the context of a weak US dollar. Suggest configuring more gold than encryption; If encryption is used, the proportion should also be controlled (within 5%). six ️⃣ US economic growth slows down+inflation intensifies The US economy is expected to grow by 2.8% in 2024 (compared to 2.5% in the fourth quarter). However, this year in 2025, due to immigration restrictions and tariff policy uncertainty, the decline in US economic growth will be exacerbated, and the economy may slow down to 1.5% for the whole year (1% in the fourth quarter), and may slow down to 1% in 2026. Due to companies transferring some tariff related costs to consumers, inflation may accelerate and reach a peak of 3% to 3.5% in the third quarter of 2025. In addition, immigration restrictions may lead to labor shortages and trigger inflation in the service industry. Overall, 2025 is bound to be a year of turbulence and high volatility, full of opportunities and crises. With high volatility, there will inevitably be peaks and valleys. 'Patience' is the biggest investment proposition of this year, and we must avoid impatience, leverage, and contracts. The core of this year is the word 'stability'. It's better to go out and enjoy the mountains and waters than to bet heavily on high fluctuations. Remember!