This year marks the 30th edition of our Long-Term Capital Market Assumptions (LTCMAs). A simple spreadsheet matrix of a couple of dozen assets, used internally to guide strategic asset allocation, has grown into a rigorous annual program covering over 200 assets in 20 currencies, relied upon by institutional and individual investors globally. 

What have we learned from the past, and what might the future hold?

Here, we reflect on our collective experience of economic and market cycles, asset allocation trends and shifts in investor behavior over the past 30 years – seeking to identify how these factors might change over the next 30 years.

We reached widely across our business and interviewed many of our most experienced investors and analysts about their careers. They told us what insights they believe the next generation of investors will need over the next 30 years. We also surveyed our rising “Gen Z” talent about their attitudes to investing and market dynamics, and what matters most to their generation when they consider their financial goals. Finally, we drew on the findings of our Private Bank’s 2025 Global Family Office Report to capture conversations with the world’s wealthiest families.

As we dug into the data, three key themes emerged – defining features of markets over the past 30 years and, we expect, the decades ahead:

• Technology, data and the democratization of markets
• A changing regulatory and policy environment
• The emergence of new assets and market actors

Several common threads connected past experiences and future expectations. Our 30-30 project, as we came to call it, proved illuminating and inspiring. We hope you’ll agree. 

30 years back: What a difference three decades makes

The investing landscape has changed significantly from that in the mid 1990s. In many ways, markets were less complex 30 years ago and reflected more directly the state of the underlying economy. Today, the stock market often seems to diverge from the economy, while bond markets price global issues as much as local ones. A market portfolio today demands a wider opportunity set and thoughtful allocation to maximize diversification.

Nevertheless, lessons from history are essential to understanding the future: As Winston Churchill wrote, “The longer you can look back, the farther you can look forward.”

Technology, data and the democratization of markets

Technology is a key theme in this year’s LTCMAs. By any measure, technology has shaped markets over the past 30 years like no other force – on this point, feedback was unanimous.

Data that was once scarce (and the domain of Wall Street’s research-driven "sell side" broker-dealers) became accessible, even ubiquitous (Exhibit 1). Over time, asset management firms developed research capabilities that rival those of traditional intermediaries. Yet investors often struggled with data overload, which amplifies behavioral biases and encourages a tendency toward momentum-following and “short-termism.”

While short-termism increases the risk of herding and market bubbles, it can also create an advantage by providing mispricing opportunities.

As data became more available, markets “democratized.”¹ Assets that were once exclusively the domain of professional investors opened up to new pools of capital. Data availability sharply narrowed the information advantage, allowing a greater diversity of investors access to a wider range of asset markets.

Another key shift accompanied the surge in data: investing success now relies less on accessing Information and more on interpreting it. This has significantly eroded the sell side’s advantage and leveled the playing field for investors. Equally, though, it has tightly bound investing success to technological innovation.

A changing regulatory and policy environment

In recent decades, policy became a key driver of economies and markets as central banks, governments and regulatory bodies influenced everything from market liquidity to asset prices.

On the regulatory front, the past 30 years unfolded in two distinct phases: the pre-global financial crisis (GFC) era of deregulation and the post-GFC era of re-reregulation. A turn back to deregulation may now be underway. Indeed, many believe that we have reached the high-water mark for both regulation and central bank independence. We explore the implications of this potential shift in the “30 years forward” section.

In the mid-1990s, investors assumed that policymakers couldn’t stop the economic cycle, they could merely respond to it. Now, investors tacitly assume that policymakers can effectively “save” both the economy and the market. In part, that reflects a growing intolerance on the part of voters, politicians and central bankers alike to suffering any economic pain.

Thus, policymakers today quickly resort to monetary and fiscal tools, seemingly at the first sign of strain. Recessions and market pullbacks have in turn become sharper and shorter, leading to more V-shaped recoveries. However, the ultimate cost of this shorter-run economic stabilization could be longer-run fragility as deficits grow inexorably with each episode of policy support.

The emergence of new assets and market actors

Over the past 30 years, three key product innovations reshaped the investing landscape: passive funds, ETFs² (the first U.S. ETF – SPY, the S&P 500 SPDR – debuted in 1993) and private capital markets. All grew dramatically in scale and scope, becoming far more accessible to all types of investors.³

Along the way, traditional boundaries blurred between public and private markets and among asset classes. Investors welcomed the new choices, which in turn changed the calculus for portfolio diversification (Exhibit 2).

New choices, new assets, new market actors. Yet an old philosophy – investing in a simple balanced portfolio of stocks and bonds – delivered steady returns over the past 30 years, buoyed by an environment of disinflation and globalization that supported both bonds and company profits (Exhibit 3). This backdrop may be evolving and so, too, portfolio construction.

What will not change, in our view, are the basic principles of good investing. A robust process is essential; diversification and strong risk management are paramount.

30 years forward: What factors will shape the next generation of investors?

How might economies, markets and asset allocation evolve over the next 30 years? We may well be at an inflection point, captured in Exhibit 4.

In addition to our veteran investors and leaders, we polled our upcoming investment talent – our Gen Z⁴ employees – about how they imagine the coming decades.⁵ Many of the factors that will shape the markets of their future are becoming apparent today.

But we remain humble as we look ahead, reminded of these words from historian Niall Ferguson: “There really is no such thing as the future, singular. There are only multiple, unforeseeable futures, which will never lose their capacity to take us by surprise.”

Will technology evolution become a technology revolution?

It feels as though technology has raced forward over the past three decades, and in many respects it has. Yet in the world of investing, the reality may be more incremental. Aside from the deluge of data, we’ve essentially been steadily automating many of the same basic processes.

All that could now change.

Two technologies, artificial intelligence (AI) and blockchain, may redefine investing in ways we can now only glimpse. Both technologies will likely expand market access and improve efficiency. How capital flows shift – and who emerges as winners and losers along the way – remain to be seen.

AI literacy is already a requisite for investors. Mastering AI will compound advantages in speed, cost and insight. For example, AI analytics will increasingly serve to personalize investment advice.

Investors will need to balance the benefits of AI automation (lower costs, greater efficiency) with the demand for human judgment (which is sometimes less obvious but rarely less important). We think humans, not AI, will be best able to spot turning points and secular shifts in the economic landscape.

We can envision a world where shorter-term investing becomes an AI vs. AI battleground, with some human oversight. At the same time, longer-term investing, and identifying market inflection points, remain a human vs. human endeavor, with AI for support.

Blockchain technology could impact investing practices related to settlement, compliance, cybersecurity and data privacy. In particular, blockchain tokenization (the conversion of real world assets into digital tokens that can then be traded) could prove transformative. It’s early days, but once regulators establish frameworks for custody and secondary trading, growth could take off.

Trading in tokens will likely boost liquidity in illiquid markets, especially private assets. That could strengthen portfolio diversification and expand market access through lower trading minimums. Equally, increased liquidity may also mean greater price transparency and possibly higher realized volatility. In any case, tokenization won’t happen quickly, but if public and private markets become tokenized, traditional and digital assets could converge. The resulting investment landscape might be unrecognizable to those of us buying and selling financial assets in 2025.

The business cycle becomes the political cycle

As we’ve said, investors have probably seen the high-water mark in both financial services regulation and central bank independence, at least for the time being. While outright deregulation seems less likely, fewer new regulations will ease cost burdens and may improve market access, especially for individual investors.

At the same time, regulators will need to be nimble to keep up with industry innovation. And investors will need to stay informed and engage with policymakers to avoid a burst of new regulation.

Large and rising deficits may well define the coming policy environment. With policymakers and voters alike unwilling to accept economic pain, deficits will be used to mitigate economic contractions. If deficits swell at the same time that central bank independence is undermined, policymakers might eventually be tempted to reprise 1950s-style U.S. yield curve control, in which the Federal Reserve capped interest rates along the yield curve to help the government finance its debt.

In this scenario, the U.S. dollar could weaken meaningfully. While we don’t see the dollar’s reserve currency status challenged over a 10- to 15-year horizon, if we look further out there is a small but nonzero risk that its status could erode, with crypto a plausible beneficiary.

If currencies are the ultimate offset to ballooning deficits, then FX becomes a key consideration as investors balance their U.S. vs. non-U.S. asset allocation (particularly as home country bias remains a perennial issue for many investors).

Traditionally, inventories and the credit cycle drove the business cycle, but the influence of policy (and politics) is growing. Supply chains are strengthening and new actors are diversifying the credit supply – dampening the impact of ebb and flow in these factors. Meanwhile, a polarized political landscape means bigger swings in economic policy and a greater impact on the wider business cycle.

We were not surprised to see that respondents to our Family Office survey identified geopolitics as the top risk impacting their portfolio positioning and outlook. If politics is increasingly influencing the business cycle and policy responses mean shorter declines and sharper recoveries, then adapting to this landscape will be key to investing tactics. Nevertheless, history shows that markets do ultimately shrug off most major geopolitical events (Exhibit 5).

New assets and actors: Build it and they will come

Asset class boundaries will continue to blur, and public and private markets will further converge – these are powerful secular trends. One illustrative data point: Our Family Office survey finds steady growth in private investment allocations, with twice as many families increasing their exposure than reducing it.

Our Gen Z cohort, on the other hand, has limited exposure to private assets. We don’t believe this reflects low risk appetite – broadly, they’ve chosen to invest in stocks, real estate and crypto more than in bonds. We think it is simply because the access products don’t yet exist for them. Should this change, and we believe it will, we expect to see a wider rotation from Gen Z investors toward private asset markets.

In the coming years, we expect further erosion of the public-private boundary. Several factors will propel the move: lighter regulation; fear of missing out (“FOMO”) among individual investors seeking access to private markets for sources of return they can’t easily find elsewhere; and, finally, companies’ desire to attract new capital.

ETFs may prove key to the public-private market convergence, as they help democratize access to private assets. Eventually, this trend may significantly diminish the return premium that private assets currently tend to command. As ETFs create their own liquidity pools, they can enhance price discovery and erode the illiquidity premia that largely explain a private asset’s premium to public markets for a median manager.

Within and beyond ETFs, we expect to see a continued rise in thematic investing, focused on trends such as demographic change and the energy transition.

Even as the investing landscape shifts, traditional financial goals will endure: buying a house, educating a child, retiring in comfort and, for a certain cohort, building generational wealth (Exhibit 6).

Generational shifts may emerge. Asset allocation and investing strategies may increasingly reflect the values of younger investors as wealth transitions from one generation to the next. More and more Gen Z investors may tend to barbell “safe” investment vehicles, such as stocks and bonds, with more speculative investments, such as crypto and meme stocks.⁶

Across geographies and generations, asset class distinctions will continue to blur as the cost of switching from credit to bonds to stocks falls, and especially as alternatives become more accessible. Information advantages that existed within asset classes have been eroded by technology. The implications for future portfolio construction seem clear: Diversification across asset classes can be complemented by using the rapidly growing investment toolkit to embed other axes of diversification across themes, factors and managers to enhance portfolio resilience.

Conclusion

The timeless principles of investing

Over the past 30 years, a larger and more professional asset management industry has lowered costs, improved access and liquidity, and strengthened investment practice – all to the benefit of savers and investors.

In the next 30 years, asset managers will need to serve a new breed of investor. We expect investors of all types and risk tolerances will become more outcome focused and more willing to use technology to personalize their portfolios. Yet we expect the market’s twin emotions, fear and greed, will be no less powerful in 30 years than they are today.

Thirty years from now, when our successors conduct a similar look-back, look-forward exercise, we expect they will be surveying a vastly changed investing landscape.

The portfolio that succeeds in the next 30 years may be hard to define today, but it is likely to be more broadly diversified and possibly contain several newer assets (Exhibit 7). A core-satellite approach may still make sense: A balanced stock-bond portfolio sits at the core, circled by many different satellites in an expanded investment universe. As the last 30 years taught us, though, there is no such thing as a “set and forget” portfolio.

Looking ahead, much is uncertain. But we are confident that successful long-term investing 30 years from now will continue to demand clear goals, strong process, discipline, diversification and risk management – the verities of 30 years ago, and today, will still apply.

¹ Democratization of asset markets refers to a process in which barriers to access – information, exchange membership, access vehicles, transaction costs and regulations – are broken down, allowing a greater mix of investors to invest in those assets.

² ETFs: exchange traded funds.

³ As private markets began to offer capital for areas that had historically been financed by public equity markets, public markets gradually evolved from being the primary source of growth financing for corporations to being an income-bearing asset for investors and an acquisition currency for corporations. See John Bilton et al., “The evolution of market structure,” 2019 Long-Term Capital Market Assumptions, J.P. Morgan Asset Management.

⁴ Gen Z, born between 1997 and 2012; millennials, born between 1981 and 1996; Gen X, born between 1965 and 1980; baby boomers, born between 1946 and 1964.

⁵ We conducted a survey of over 150 of our investing and research associates and vice presidents across Asset and Wealth Management to canvass their views on markets, investing attitudes, the shape of technology and the evolution of assets and access.

⁶ A stock that is more driven by viral attention, hype or coordination on social media than by its underlying fundamentals or valuation.