Over the past few months, Aspect Capital has been reflecting on some of the structural forces shaping the global economy and how they influence markets in the years ahead. Given the current geopolitical and macro backdrop, these themes, the Five Ds, have been front of mind for investors globally. Institutional Investor sat down with Razvan Remsing, Aspect Capital’s Director of Investment Solutions to discuss how the Five Ds, deglobalization, defense spending, decarbonization, de-dollarization and demographics are shaping his investment philosophy and portfolios. Razvan also explained why these themes remain relevant across all market cycles, not just in today’s volatile environment.
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Razvan Remsing:
The genesis of this framework comes from the global, systematic nature of our strategy. We’re constantly looking for narratives to highlight long-term drivers of market returns. It’s helpful to step back and identify the deeper structural forces shaping markets, rather than getting caught up in short-term noise.
There’s no magic to the “five Ds.” It really started as I was trying to make sense of the shifting macro landscape while speaking with our investors. The question I kept asking was: What are the big drivers of structural change in markets today? You always hear the same familiar terms—deglobalization, decarbonization, demographics.
We’ve come from a period of remarkable macro stability: central banks and developed economies aligned, global supply chains efficient, and cooperation on defense and technology strong. That world has eroded over recent years, particularly since the pandemic. The signs of fragmentation had already appeared a decade ago—with nationalist movements in Europe, the first Trump presidency, Brexit, and the early trade tensions with China that later extended into subsequent administrations. Those pressures have only intensified.
The pandemic revealed just how fragile global supply chains really are. Companies and governments alike began to prioritize security and certainty of production over pure efficiency, even at higher costs. That shift naturally brings inflationary pressures.
What ties these five Ds together is the idea of fragmentation of opportunity. Geography suddenly matters again—financial assets, equity markets, bond markets, and currencies are behaving in far more distinct ways. Inflation, while off its peak, hasn’t been extinguished; its “embers” are still glowing across different regions. If you accept that deglobalization and trade barriers are inflationary by nature, then this is a long-term story, not a short-term cycle.
This demonstrates the importance of location. It’s no longer enough to think in terms of “developed” versus “emerging” markets. The dynamics in the KOSPI, the Taiwan Stock Index, the S&P 500, and the FTSE are increasingly divergent. For us, that’s actually an advantage. We run a globally diversified, bias-free portfolio—no regional or asset class constraints—and that includes significant exposure to commodities.
Several of the other Ds strengthen the case for commodities as essential components of portfolios today. Take defense spending, for instance: the post-Ukraine environment has driven a rethinking of NATO commitments and industrial capacity. Then there’s decarbonization—a long-running but still potent theme. Every region is taking its own approach: the U.S. is leaning back into hydrocarbons, China remains coal-heavy while accelerating solar investment, and Europe is emphasizing nuclear, wind, and hydro to compensate for reduced Russian energy. The result is a highly varied global energy landscape.
The recent AI boom adds a new twist—massive energy demand. That, too, reinforces the importance of commodities, not just as ancillary assets but as core macro exposures. Regardless of one’s stance on climate change, these shifts are driven by practical needs: meeting current demand efficiently and sustainably. Over time, better technology will lower energy costs, but in the interim, these transitions are deeply inflationary and opportunity-rich.
When it comes to demographics, the shifting balance between an aging population and declining fertility rates results in investment portfolios needing to extend their investment horizons and take on more growth risk, for longer. Consequently, liquid, adaptive and diversifying strategies, such as systematic managed futures, are well-placed to add resiliency to institutional portfolios during periods of sustained structural change.
Finally, we come to de-dollarization—a theme shaped by shifting sentiment among non-U.S. participants regarding the security of dollar assets. I don’t believe there’s a credible substitute for the dollar yet, but the behavior of other major currencies—the Swiss franc, euro, and yen—during recent market shocks was telling. For the first time in years, we saw equity markets fall while the U.S. dollar also weakened.
That dynamic has prompted institutional investors to reconsider portfolios overly exposed to dollar risk. It’s not about abandoning the dollar, but about diversifying opportunity—opening the door to more nuanced, global, multi-currency, multi-asset class portfolios.
Note: Any opinions expressed are subject to change and should not be interpreted as investment advice or a recommendation.
