Insights

This is the 20th edition in our series of Trip Insights, following a trip taken by Sarah Shaw, Global Portfolio Manager, to Latin America in August 2025. The trip provided invaluable insights into the evolving regional and global geopolitical and economic concerns and their impact on what we would consider an otherwise very positive fundamental outlook for infrastructure operators.

The aging population presents a powerful investment theme, but as the recent legal setback for Lifestyles Investment Communities (ASX: LIC) shows, execution matters. LIC’s plights highlight the risks of complex structures in thematic investing. In contrast, North American senior housing REITs offer a clearer, cashflow-driven model with strong secular tailwinds.

‘Far more money has been lost by investors preparing for corrections, or trying to anticipate corrections, than has been lost in corrections themselves.’ Peter Lynch, Learn to Earn, 1995

If you think share prices are becoming more volatile during earnings season, you’re not imagining it.

Quality companies typically trade at premium valuations, but when cyclical headwinds are conflated with secular falls, even the best businesses can be dismissed by the market. When heroes stumble excessive negativity can present opportunities to buy quality at a discount. 

As markets navigate the post-COVID landscape, many assumptions once considered unshakable are being challenged. E-commerce, once seen as unstoppable, may be hitting its limit. Physical retail is making a quiet comeback, while industrial real estate faces headwinds.

The North American freight rail sector is a critical pillar of the US economy and one of the largest and oldest sectors in the global listed infrastructure universe.

"The investor's chief problem — and even his worst enemy — is likely to be himself." Benjamin Graham, 1949

In 4D’s 2025 January Outlook we discussed what the year ahead could bring. Reflecting upon the risks and opportunities we highlighted, and the events of the last six months.