[2025 Alternative Investment Forum] "Interest Rate Cuts Amid Inflation Concerns... Alternative Investments Should Be Increased"

Heechan Park, Head of Research Center at Mirae Asset Securities
Rising Stock Market Valuations Highlight the Need for Diversification
Focus on Gold, Digital Assets, and Commodities

As the United States and other countries are expected to lower interest rates while concerns over global inflation remain unresolved, analysts predict that the importance of alternative investments such as gold, digital assets, and commodities will grow.

Heechan Park, Head of the Research Center at Mirae Asset Securities, spoke as a lecturer at the 3rd Asia Economy Alternative Investment Forum held at the Conrad Hotel in Yeouido, Seoul, on the 16th, stating this under the theme "Opportunities for Alternative Investments Amid a Bullish Stock Market and Industrial Structure Changes."

This year, the global economic growth rate is expected to reach its lowest level since 2010, excluding the initial outbreak of COVID-19 in 2020. This is due to the high level of uncertainty regarding the recovery of next year's growth rate, caused by the United States' excessive prioritization of its own interests and the weaponization of tariffs. Park stated, "Global economic stagnation is deepening due to tariff risks and other factors, and low growth may continue into next year following the second half of this year. The economic recovery remains challenging," he said.

Heechan Park, Head of the Research Center at Mirae Asset Securities, is attending the "3rd Asia Economy Alternative Investment Forum" held on the 16th at the Conrad Hotel in Yeouido, Seoul, delivering a lecture on the topic "Global and Korean Industrial Structure Transformation: Risks and Opportunities for Alternative Investors." Photo by Jinhyung Kang

On the other hand, global stock markets continue to be overvalued. Park noted, "U.S. stocks saw gains in the 20% range in both the year before last and last year, and a rise in the 10% range is expected this year as well. Chinese, Western European, and Korean stock markets are also recording significant increases." He added, "With current expectations surrounding artificial intelligence (AI), stock prices have become excessively high. As a result, expected returns are declining, especially in the U.S. and Western European stock markets."

Park emphasized that "the burden of stock market valuation has increased the importance of diversification." He explained, "The Trump administration is pressuring for interest rate cuts, and the U.S. central bank is following suit. This means that interest rates are being lowered even though inflation has not sufficiently subsided. In addition, U.S. tariff policies are stimulating the prices of goods and services, so as the end of the year approaches, the burden of inflation could intensify," he projected.

As an alternative for diversification, Park first pointed to "gold." He said, "With the weakening of the U.S. dollar, major central banks are increasing their gold holdings," and "Gold investment is gaining attention as the most effective complement to U.S. stocks." He continued, "From an asset allocation perspective, it is necessary to secure a certain portion of gold in portfolios. Central banks in emerging markets such as China, India, and Russia are leading the expansion of gold purchases, which is a structural factor supporting the strength of gold prices," he analyzed.

He also highlighted "digital assets." Park stated, "Digital assets can be considered competitors to gold. In the U.S., systems related to stablecoins and security tokens (STOs) are being established, and financial companies are likely to expand services related to them. Attention should be paid not only to the assets themselves but also to companies expanding these services." He explained that, in particular, the Trump administration's executive order has allowed digital assets to be included as investment targets for U.S. retirement pensions, which could generate new demand.

Park also discussed the outlook for the "commodities" market. He said, "With the spread of AI, demand for electricity and data is increasing explosively, which will drive up demand for copper and uranium. Uranium, in particular, deserves attention. While nuclear power is gaining attention as a stable source of electricity, there is also a growing negative view regarding the long-term supply of uranium," he said.

In addition, he stated, "Rare earth elements have always attracted attention amid U.S.-China tensions. China is responsible for 70% of global supply, but its actual reserves account for only 40%. As the U.S. seeks to reduce dependence on China and secure new sources of supply, related investments and development discussions are becoming more active."

Furthermore, Park added, "Although there are projections that the KOSPI could rise to 5,000 points, the core of investment ultimately lies in diversification. From the perspective of easing inflationary pressures, alternative investment strategies involving gold, commodities, and digital assets must be considered."