The Franklin Templeton Institute surveyed portfolio managers across all our asset classes: equity, private equity, fixed income, private debt, real estate, digital assets, hedge funds and secondary private markets. The goal of the Global Investment Management Survey is to provide the most comprehensive global view on the dimensions that matter most to our clients.
The findings reflect the average of the group. While each of our investment teams are independent and have different outlooks, the survey serves as a starting point in understanding Franklin Templeton’s aggregate views on the economy, equities, fixed income and alternatives.
The survey results outlined in this paper are as of May 2025, and the market data is as of September 30, 2025.
Exhibit 1: Expectations for 2025 Based on the Franklin Templeton Global Investment Management Survey
Focus on Quality Across All Asset Classes
Source: Franklin Templeton Institute Global Investment Management Survey expectations are for 2025 and are as of May 2025. Survey methodology included at the end of the paper. *Updated survey stats as of August 8, 2025.
Key takeaways
Economic growth slowing but positive
- Global growth will be in line with consensus expectations across major regions.
- We expect core PCE to approximate 3.00%–3.50% and will likely remain above central-bank targets.
- Unemployment will remain relatively low in the United States and will end the year between 4.50%–4.75%.
- The US dollar will weaken modestly in 2025.
Equities likely to end the year at 6400-6800 (S&P 500 Index target)
- Earnings will grow at 5%–10% versus consensus 11.8%.
FAVOR
- US large cap, value and growth. We expect the stock market to continue to broaden out. We are bullish on Europe, India and Japan.
- Sector focus on technology, financials and health care.
- Factors to focus on include free cash flow yield, balance sheet strength and return on invested capital.
RISKS
- Recession, geopolitics and earnings below expectations.
Shorter duration fixed income will broadly benefit from declining interest rates on the front end of the curve in 2025
FAVOR
- Although default rates for high-yield debt are likely to tick modestly higher in 2025, spreads are expected to increase moderately in a sector with relatively low interest rate risk and high all-in yields.
- Shorter duration fixed income will be in favor, as rates are still relatively high and will come down only modestly by the end of 2025.
- Municipals will continue to be a high-quality, diversifying investment option with attractive tax-free yields.
RISKS
- Geopolitics and the policies of the Fed and other major central banks.
WHAT ARE THE RISKS?
All investments involve risks, including possible loss of principal.
Fixed income securities involve interest rate, credit, inflation and reinvestment risks, and possible loss of principal. As interest rates rise, the value of fixed income securities falls.
Equity securities are subject to price fluctuation and possible loss of principal.
Investments in lower-rated bonds include higher risk of default and loss of principal. Changes in the credit rating of a bond, or in the credit rating or financial strength of a bond’s issuer, insurer or guarantor, may affect the bond’s value.
International investments are subject to special risks, including currency fluctuations and social, economic, and political uncertainties, which could increase volatility. These risks are magnified in emerging markets.
Alternative strategies may be exposed to potentially significant fluctuations in value.
Privately held companies present certain challenges and involve incremental risks as opposed to investments in public companies, such as dealing with the lack of available information about these companies as well as their general lack of liquidity.
Real estate securities involve special risks, such as declines in the value of real estate and increased susceptibility to adverse economic or regulatory developments affecting the sector.
Because municipal bonds are sensitive to interest-rate movements, a municipal bond portfolio’s yield and value will fluctuate with market conditions. Bond prices generally move in the opposite direction of interest rates. Thus, as prices of bonds in an investment portfolio adjust to a rise in interest rates, the portfolio’s value may decline. Changes in the credit rating of a bond, or in the credit rating or financial strength of a bond’s issuer, insurer, or guarantor, may affect the bond’s value.
Dividends may fluctuate and are not guaranteed, and a company may reduce or eliminate its dividend at any time.