Freedom Holding Corp.’s CEO, Timur Turlov, Shares His Vision on Global Finance Trends

The ability of macroeconomic trends to influence financial markets remains a significant discussion point among experts and investors. During the ITS Ideas 2024 conference in Astana, Timur Turlov, CEO of Freedom Holding Corp., shared his vision of the key trends that all market participants should take into account.

Macroeconomics and pressure on leaders

According to Timur Turlov, growing pressure on leaders in various industries, amidst new macroeconomic challenges, is one of the most important trends today. Countries suffering from budget deficits are seeking additional sources of income and their attention is increasingly focused on large, highly profitable corporations.

“The current macroeconomic environment forces governments to put more pressure on productive leaders, which will inevitably change their operational and financial strategies,” Timur Turlov said during his speech at the conference.

As he noted, these companies have no choice but to adapt to this new reality, where the top priorities are taxes, regulation and control. Those businesses that can effectively integrate regulatory changes into their strategies will have an advantage.

While discussing the macroeconomic conditions that shaped these trends, the CEO of Freedom highlighted a paradoxical situation: the key rate, designed to regulate economic activity, has ceased to fulfill this function over the past decade.

“The developed world has never lived at zero key rates for this long. This period was unbelievably long, lasting 15 years. We haven’t seen risk-free yields remain at zero for so long,” he emphasized. As a result, these extremely low rates hindered rapid loan growth and now, as rates have peaked, the economy’s growth is being driven by a surge in the stock market, fueled by technological innovations.

Monopoly risks and the Magnificent Seven

Timur Turlov also addressed the risks associated with monopolization and the challenges facing the tech giants commonly referred to as the Magnificent Seven: Microsoft, Apple, Google, Amazon, Facebook, Tesla and Nvidia. The market has become concentrated around these companies, causing their market caps to soar to unprecedented levels, with huge volumes of traded stocks. “It took Nvidia 20 years to make its first trillion, a year and a half to reach the second trillion, one quarter for the third trillion and perhaps just a couple of days to secure the fourth one,” Turlov said, citing the astonishment of investors at the rapid growth of these companies.

Investors believe that the innovations introduced by the Magnificent Seven, particularly in artificial intelligence (AI), can change the world. “People have noticed this major revolution and no longer care whether central banks’ rates are at 0%, 6% or 12%. This has driven market demand and investment activity,” the Freedom Holding Corp. CEO highlighted.

However, despite the immense potential and industry dominance of these businesses, they are facing increasing attention from antitrust agencies and regulators.

Timur Turlov pointed to an antitrust investigation against Nvidia in the U.S. as an example of the growing regulatory pressure, even on the most powerful companies. “Investigations and regulatory measures can significantly harm the profitability and growth prospects of even giants like Nvidia,” he warned.

This is why investors should exercise caution with the big seven stocks, although they are likely to maintain their market shares, Turlov believes.

Freedom Finance Global, a subsidiary of Turlov’s Freedom Holding Corp., operates in the Astana International Financial Centre (AIFC) under English law, providing investors the opportunity to trade major international stocks and offering analytical data for the U.S., Kazakh, German, Uzbek, Armenian, and UAE markets. These investment surveys are particularly useful for analyzing the macroeconomic situation and identifying attractive companies for investment.

Diversification is key to success amidst growing volatility says Timur Turlov

To navigate these challenges, Timur Turlov recommends that investors not rely solely on companies from the top seven and instead diversify their portfolios. He believes that small- and mid-cap businesses, which practice sustainable, transparent and socially responsible business models, may prove more adaptable amid increasing pressure on market leaders.

Timur Turlov also noted that such businesses may be undervalued by investors, offering additional opportunities for those looking for alternatives in their investment strategies. “Diversification of your portfolio by investing in small-cap companies and socially responsible businesses can provide long-term stability,” Turlov added.

As a financier with years of experience in the industry, Timur Turlov advises seeking out assets that few consider good investments. “There’s one thing you should know: small- and mid-cap businesses will face much less fiscal pressure than large companies. That’s why, when you analyze a successful large company, you need to take into account basic trends, the existing rules of the game and the fact that governments will inevitably intervene,” he said.

Timur Turlov also stressed the importance of sustainable development and social responsibility in today’s world. He believes that companies operating under ESG principles can better adapt to new economic realities.

The businessman is convinced that these companies are becoming more attractive not only to investors but also to governments. “More and more investors consider ESG practices a key factor when making investment decisions, while governments support such initiatives with tax benefits and other incentives.”

According to the CEO of Freedom Holding Corp., uncertainty and volatility in stock markets are likely to increase over the next few years due to global macroeconomic factors and national challenges. “We’re living in an era of rapid change, meaning that a company’s success will depend on its ability to adapt to new challenges and seize the opportunities that arise from these changes,” Turlov emphasized.

In concluding his speech, Timur Turlov summarized that anyone seeking to create a well-balanced investment portfolio should focus on high-yield assets, bonds from developing countries, and small- and mid-cap companies. These segments typically experience less regulatory and tax pressure, providing an additional advantage in today’s economic environment.

__

(Featured image by Scott Graham via Unsplash)

DISCLAIMER: This article was written by a third party contributor and does not reflect the opinion of Born2Invest, its management, staff or its associates. Please review our disclaimer for more information.

This article may include forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “become,” “plan,” “will,” and similar expressions, including with regards to potential earnings in the Empire Flippers affiliate program. These forward-looking statements involve known and unknown risks as well as uncertainties, including those discussed in the following cautionary statements and elsewhere in this article and on this site. Although the Company may believe that its expectations are based on reasonable assumptions, the actual results that the Company may achieve may differ materially from any forward-looking statements, which reflect the opinions of the management of the Company only as of the date hereof. Additionally, please make sure to read these important disclosures.