AI, the energy transition, and geopolitical tensions are reshaping the global economy and markets.

They're also transforming the landscape of infrastructure investing.

I'm Alison Nathan, and this is Goldman Sachs Exchanges.

For today's episode, I'm joined by Tavis Canal, the global head of infrastructure within

Goldman Sachs alternatives, which is part of our asset and wealth management

business. We'll be exploring the mega trends driving opportunities and the outlook for the sector.

Tavis, welcome to exchanges. Thanks, Allison. Look forward to our discussion today. So Tavis, we're

obviously in a very volatile market environment and investors are starting to look closely at their asset allocations.

So let me start by asking you, what role can infrastructure play in portfolios?

Well, look, it's a great question. And, you know, in all of our client conversations today,

obviously, everyone's reading the newspaper and trying to digest some of the changes

that are happening.

I think what's interesting about infrastructure is that in particular, when you look at

institutional investors, they've really progressively increased their allocations to the asset

class over the last 10 plus years.

And so today, to give context, most large institutional investors have around 6, 7% of their total assets invested into infrastructure. And, you know, there's, they've done that for a couple of reasons. I think, you know, firstly, the asset class is really a diversifier. So the correlation has low correlation with, you know, public equities, with public fixed income, but also with other private asset classes.

I think secondly, you know, it's been very resilient in particular in periods of economic uncertainty, high inflation.

So, you know, one stat that we talk about with lots of our clients is you look market wide.

And since the beginning of 2022,

Infra has returned 9% compounded returns across the whole asset class.

And that compares with like buyout private equity at 5%, real estate at like minus 2.

So you know, you look across different asset classes in the period over the last three years

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