The turbulent economic environment is also rewriting the investment market. Still, the co-owner of the region's leading investment bank told Index that these should not be seen as obstacles but as opportunities for adaptation. He emphasized that the world is "in chaos," but this is also a kind of "wake-up call" or "moment of realization" for Europe.
In recent years, and especially in today’s changing economic environment, the development of flexible investment strategies that balance global challenges has become increasingly valuable, said Jan Sykora, co-owner of Wood & Company, in an interview with Index.
When considering the turbulent geopolitical and economic situation, it is enough to think of Donald Trump's tariff policies, the war in Ukraine, inflationary pressures, or even high interest rates—all of which pose significant challenges to traditional investment models. "However, these should not be seen as obstacles but rather as opportunities for adaptation," emphasized Jan Sykora, who believes that long-term inflation fears are exaggerated, as demographic trends (e.g., Europe’s aging population) and technological developments have a deflationary effect. The historic stock market crash seen in recent days (the interview was conducted on Monday, April 7)—although its full impact is not yet visible—is more of a buying opportunity in the medium and long term than a signal to panic and sell.
Instead of lamenting the old global order, we need to embrace new realities. The world is in “chaos,” but this is also a kind of “wake-up call” for Europe. The protectionist measures of the Trump administration and the serious consequences of the Russian-Ukrainian war could ultimately shape Europe into a more efficient and self-aware economic entity. The EU must realize that it can no longer rely on cheap Russian energy or American defense—the current situation presents an opportunity to become independent. If the U.S. turns inward, Europe will have to seek out new partners: Africa, Latin America, Asia, and eventually even China. Trade wars may be destructive in the short term, but over time they can give rise to new trade zones, Sykora said.
Technology as a Response to Global Uncertainty
We also asked what alternative instruments, in his opinion, investors might focus on when building their portfolios, beyond the traditional bond-stock-currency mix. Jan Sykora stated that alternative instruments can not only complement a portfolio but also create outstanding long-term value. That is why they actively seek investment opportunities that offer protection against inflation, provide stable returns, or offer a personal connection and experience to their clients.
WOOD has established its own real estate funds to invest in office buildings, shopping malls, residential, and logistics properties. These real estate assets are considered especially valuable, as their long-term returns tend to exceed inflation. Management is handled by an in-house team of 60 experts, ensuring professional oversight and liquidity with quarterly valuations.
- Another key alternative asset class, beyond real estate, is renewable energy. The company focuses specifically on solar, wind, and battery projects. The aim is to replace outdated fossil fuel infrastructure with sustainable, modern systems. The geographical focus is also strategic: solar energy is targeted for sunny southern Europe, and wind energy for the windier northern regions.
- The company has also launched a blockchain infrastructure fund, not to speculate on cryptocurrencies themselves, but to invest in the underlying technology. WOOD sees blockchain as critical for the future of transactions involving machines and smart devices, offering significant potential.
- They also engage in private equity and venture capital investments in sectors such as waste management, pharmaceuticals, and medical technologies. These are targeted, yield-focused investments intended to deliver long-term value.
- Sykora also highlighted art investment as an exciting area. He mentioned the acquisition of one of the largest collections of Alfons Mucha’s work, which they offer to clients in a detailed and curated format. This not only offers financial returns but also provides emotional and cultural value.
- They like to spice up a small portion of client portfolios with “experience-based” investments, such as wine, whiskey, vintage cars, or watches. These satisfy personal interests and make investing a more engaging experience.
“Overall, WOOD’s alternative investment strategy is shaped by diversification, long-term security, and a creative, enjoyable approach to wealth building,” said Sykora. He added that one of the greatest long-term sources of confidence is technological progress. That’s why they are investing in artificial intelligence, fintech solutions, and robo-advisory platforms. These tools not only allow for more efficient operations but also make investing more accessible to retail clients, thereby dampening market volatility.
“Eighty percent of an investment portfolio should be boring, but the remaining 20 percent can be exciting and fun,” Sykora said.
Education, Education, Education
Sykora stressed that investor education should remain a top priority. “The foundation of well-functioning markets is an informed and aware investor. We aim to play an active role in fostering this, whether through analyses, events, or educational programs.”
Jan Sykora also shared his leadership philosophy. He believes the key to stable growth lies in ethical business practices, continuous development of expertise, and a business model built on personal relationships. “The most important value for us is the trust of our clients. We can only maintain that if we remain consistent, honest, and professional in every situation,” he concluded.
East-Central European “hunger” and ambition
One of the region’s major advantages—especially in countries like Hungary, compared to Western Europe—is what Sykora calls “hunger” and ambition.
Poland, the Czech Republic, Slovakia, Romania, and Hungary are far more energetic and entrepreneurial, and thus better positioned to benefit from the new global order. This ambition, coupled with entrepreneurial drive and flexibility, creates fertile ground for investment.
Due to the global stock market downturn and falling bond yields in Western Europe, many investors are looking for alternatives that offer real returns. Real assets in Central and Eastern Europe—such as real estate or renewable energy—offer potentially high returns at more attractive valuations compared to Western Europe. Additionally, the region continues to draw foreign capital thanks to its developing capital markets, growth potential, and openness to technological innovation.
Central and Eastern Europe could remain an appealing destination for global investment. The region's capital markets are undervalued despite strong fundamentals. Western investors are beginning to realize that these countries, despite their smaller size, have greater growth potential than the already saturated markets of Western Europe.
Sykora envisions that more Americans may choose to relocate to Europe in the coming years, attracted by the region’s livability and quality of life. Budapest, Prague, and Vienna are among the most livable cities in the world, he noted.
“Central and Eastern Europe is no longer just following the West—it is capable of leading in certain areas, such as technological adoption, fintech solutions, and investment platforms,” Sykora stated.
Hungary’s Real Estate Market and Its Potential
Jan Sykora views Hungary as a distinct yet integral part of the Central and Eastern European region. He believes one of the Hungarian market’s greatest strengths lies in the quality of its entrepreneurial class, which is generating new investment opportunities, especially amid generational transitions.
Hungary’s international perception is often more negative than its economic reality warrants, which can be an advantage from an investment standpoint: it is a “slightly undervalued” market with hidden opportunities.
The company executive noted that Hungary shows particular promise for digital financial services and technological development. Although WOOD has not made major investments in Hungarian real estate to date, the company is currently exploring several opportunities.
Hungarians Are Used to Risk-Free Returns
Recent headlines about high bond market interest rates have attracted many Hungarians to government bonds. “The truth is that people have forgotten to consider inflation. Fixed-rate instruments often do not keep up with inflation,” said Jan Sykora. (That said, there are inflation-indexed options, such as the Premium Hungarian Government Bond, PMÁP, which has significantly impacted the investment market.)
High interest rates have indeed become serious competitors to real estate investments in recent years, particularly in Hungary, where the population has become accustomed to risk-free annual returns of 13–18%.
However, Sykora warns that this can be misleading, as inflation-adjusted real returns are often negative. Meanwhile, the value of real assets, such as real estate, better compensates for monetary erosion in the long term.
Many people begin their investment journey by buying property, but this often yields modest returns and can be burdensome to manage. That is why, according to Jan Sykora, more clients are turning to real estate funds: they’re easier to handle, more liquid, and do not require day-to-day management. Diversified, professionally managed real estate portfolios are a more practical solution.
Source: Index.hu