Investing in infrastructure
How can you invest in infrastructure, and what investment opportunities are available in this area? What opportunities are there, and what risks are likely to arise? Find out more now.
Infrastructure: megatrend and investment theme
Infrastructure is increasingly establishing itself as a strategic investment theme for the future. Driven by political programmes, climate change and digital transformation, new growth opportunities are emerging worldwide. Investing directly in infrastructure projects often involves very high minimum investments. Infrastructure funds turn an asset class that is otherwise not very accessible into an investable option. These are special equity funds that invest in a broad range of companies involved in building or managing infrastructure or supplying key infrastructural components.
Why invest in the infrastructure megatrend?
Infrastructure is a true global megatrend – and it essentially always will be. It needs to be kept going, expanded, upgraded, and made fit for the future. Trillions are being invested in new infrastructure projects worldwide.
Infrastructure is what links us together. It brings us light, keeps us warm, helps us get to work and back home again quickly (usually), and enables trade to take place. Roads, railways, fibre optic networks, radio masts, airports, hospitals, water supply systems, and waste disposal facilities are just a few examples of what makes up the ubiquitous network that is infrastructure.
Infrastructure is the backbone of our society and economy. It is literally the foundations underpinning society and the economy.
We rely on constant access to effective infrastructure systems. A fast Internet connection, flowing traffic, and a reliable energy supply are basic things that we take for granted in business and everyday life. Trouble ensues when a prolonged disruption occurs.
Infrastructure is changing: investments are becoming digital and sustainable:
Infrastructure is often associated purely with “traditional” aspects such as roads, railway lines, or power lines – in other words, technical infrastructure. To keep up with our rapidly growing and evolving society, however, new dimensions like climate change, digitalisation, changes in mobility, and urbanisation are constantly being added to the mix. Fundamental changes are needed to make our infrastructure fit for our future life.
As well as being intelligent and digital, however, these modern solutions also have to be sustainable and climate-resilient. A great deal of new infrastructure is needed if the 17 United Nations Sustainable Development Goals are to be met. From clean water to sustainable communities, the Organisation for Economic Co-operation and Development (OECD) estimates that an annual investment volume of around seven billion US dollars is needed to make infrastructure environmentally friendly.
A complete rethink is called for when it comes to transporting and storing energy or managing electricity networks. Global data networks, self-driving vehicles, the Internet of Things, smart cities – all of this requires innovative solutions in terms of infrastructure.
For example: Power grids need to be modernised to ensure a successful energy transition. The conventional power infrastructure is designed for a central energy system based on fossil fuels. Electricity used to flow one way, from large power stations and through the grids to consumers. With a growing number of small photovoltaic systems and wind farms being integrated into the network, electricity is now flowing in all directions all the time. Renewable energy – like wind and solar power – is more volatile and less centralised, with consumers increasingly becoming producers too by installing solar panels on their roofs. To balance electricity supply and demand, power grids need to be smarter and more digitalised.
Are you interested in private infrastructure investments? Information about private infrastructure is available on our website for institutional investors.
Global infrastructure initiatives are driving the sector forward
Governments and companies around the world are investing billions in infrastructure:
United States: The United States, for example, has launched a £1.2 trillion programme called "the Infrastructure Investment and Jobs Act", which aims not only to modernise roads and bridges, but also to accelerate the expansion of renewable energies and digital networks.
Europe: In Europe, too, the Green Deal and the "NextGenerationEU" programme are providing massive financial resources, a significant portion of which is being channelled into sustainable infrastructure projects.
China: In Asia, China continues to invest heavily in ports, rail networks and energy projects as part of the "Belt and Road Initiative" in order to secure long-term competitiveness. The aim is to make trade routes between Asia, Europe and Africa more efficient, reduce transport costs and optimise international supply chains.
Digital infrastructure: In addition to traditional transport projects, data centres and fibre optic connections are also increasingly coming into focus in order to strengthen the digital infrastructure along these routes.
What should be considered with infrastructure equities?
Diversification: The infrastructure sector is by nature highly diversified and has more facets to it than virtually any other. Water, transport, energy, and other segments such as education, health care, and telecommunications all fall under the infrastructure umbrella.
Essential: There is always a need for infrastructure. It is essentially concerned with basic services and is relatively unaffected by the development of short-term market cycles. Demand for water and power supply, for the construction and maintenance of transport routes, and for telecommunications services is relatively constant.
Long-term: Many contracts between business enterprises are concluded on a long-term basis – over several years or even decades. They are also often linked to inflation (price adjustment clauses).
High market entry barriers: The infrastructure sector often sees high capital requirements and territorial limits. As a result, the barriers to new players entering an existing market in the first place are often very high. Certain areas of infrastructure are therefore dominated by a select group of companies.
In addition to general uncertainties relating to business operations (e.g. management errors, unforeseen additional costs), there are specific risks involved in the infrastructure sector:
Regulatory or legal framework conditions can fundamentally change business prospects.
Politics is another factor that can create uncertainty. For instance, the government in a particular region may simply do a U-turn and decide not to implement a planned infrastructure project after all, possibly due to opposition from the local community.
Forces of nature also pose a risk, as they can quickly inflict substantial damage to infrastructure in particular.
Basic equity risks (e.g. increased price volatility, unfavourable exchange rate fluctuations) can never be excluded. Anyone investing in funds such as Raiffeisen-Infrastruktur-Aktien should be aware of these risks and bear them in mind.
Investors in infrastructure should have an investment horizon spanning multiple years.
One advantage of the very diverse infrastructure sector is that it contains both explosive growth and strongly economically driven stocks, as well as quite a few rather ‘unattractive’ companies that are less dependent on economic cycles. The latter are often involved in the construction and operation of infrastructure (i.e. airports, motorways, ports, etc.)
This means that infrastructure equity funds often perform better than the broader equity market in economic downturns, but tend to underperform in strong economic upturns. In this respect, they are a good way of diversifying an equity or mixed portfolio.
Nevertheless, they are not immune to economic downturns and the associated risks to profit development and equity prices, or to general downward movements in the markets. Like all equities, they are subject to the risk of significant price fluctuations, including losses in value and capital.
Fund manager on the subject of infrastructure
 "Stefan Grünwald, Raiffeisen Capital Management")
Stefan Grünwald
Mr. Grünwald provides insights into the transformation of infrastructure and answers questions about whether infrastructure is a worthwhile investment theme for investors and which megatrends could be interesting for infrastructure.
Zukunfts-Thema Infrastructure
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State: November 2025