The outperformance of APAC equities in 2025 has reignited interest among asset owners in allocating towards the region, but Franklin Templeton’s investment strategist Christy Tan said investors should approach the allocation with a structural perspective. She argued the investment case for APAC has shifted from a tactical to a structural buy, driven by several markets’ economic diversification from export dependence to trade diversification and domestic consumption-driven growth.
Tan, who is based in Singapore, said conflicts in the Middle East and the ensuing energy price spikes means APAC markets will see some divergence in the foreseeable future. While energy importers will face growth headwinds, commodity exports would see favourable trade conditions. From a portfolio construction perspective, it is time that allocators lean into specific country tilts rather than broad regional exposure.
In a conversation with Top1000funds.com Asia Pacific correspondent Darcy Song, Tan unpacks how APAC allocations can contribute to portfolio resilience in a geopolitically bifurcated world, and what a volatile US-China relationship would mean for the region.