The Israeli shekel has become an increasingly important part of the investment case for Israel. As the currency has appreciated, foreign investors have gained a clearer signal of confidence in Israel’s economy, capital markets, and long-term resilience. For investors seeking international diversification, exposure to Israeli assets now offers not only access to a dynamic market, but also the potential benefit of currency strength.

What Is Driving the Strengthening of the Israeli Shekel?

Over the past 12 months, the Israeli shekel has strengthened sharply, rising to levels not seen in decades. The Israeli currency broke a 32-year high as it moved below the 3 shekels per U.S. dollar mark last week. The shekel has gained roughly 68% against the U.S. dollar since mid-2002.

In just the past 12 months, local currency gained 24% against the USD, outpacing almost all major currencies and signaling a marked shift in market sentiment. Among major freely traded currencies, a 20%+ appreciation in a single year is highly unusual — placing the shekel among the strongest global performers in recent history.

This appreciation reflects a combination of improving geopolitical expectations, resilient economic performance, and supportive global conditions. Recent developments in the Middle East and a decline in Israel’s risk premium have played a central role in shifting investor sentiment, encouraging renewed capital inflows into local markets.

At the same time, the domestic economy has continued to perform, led by its technology sector and supported by steady capital inflows from abroad. Israel’s high-tech industry remains a key driver of foreign currency earnings, while continued startup fundraising and investment activity have helped anchor the shekel’s strength. Even during periods of heightened uncertainty, the economy has demonstrated an ability to absorb shocks without major structural damage.

External factors have also contributed. The broader weakening of the U.S. dollar, alongside the recovery in global equity markets, has reinforced the shekel’s appreciation, particularly through institutional investment flows and hedging activity. Taken together, these forces point to a currency move driven by both domestic fundamentals and global dynamics, rather than a short-term fluctuation.

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Why a Strong Shekel Matters for Foreign Investors

A strong shekel signals growing confidence in Israel’s economic and financial system, even against a complex geopolitical backdrop. Currency appreciation typically reflects capital inflows, reduced risk perception, and expectations of future stability, all of which are central considerations for international investors.

For those allocating capital, currency direction has a direct impact on both risk and return. A strengthening shekel reduces the likelihood that exchange-rate movements will erode gains, while also suggesting that local assets are benefiting from sustained demand. This can make the Israeli capital market more attractive relative to peers, particularly in periods when global investors are seeking resilient and differentiated exposure.

There is also a behavioral dimension. Strong currency performance tends to attract attention from institutional investors tracking relative market strength. As capital reallocates toward outperforming markets, the shekel’s appreciation can reinforce its own momentum, further strengthening the investment case.

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How a Strong Shekel Supports Israeli Market Performance

The relationship between currency strength and market performance is often mutually reinforcing. In Israel, the appreciation of the shekel has coincided with gains in the local equity market, pointing to a broader improvement in investor sentiment.

As equity markets rise, they tend to attract additional foreign capital, which in turn supports the currency. This dynamic has been particularly visible in Israel over the past 12 months, with the local equity market (TA-35) delivering gains of around 77% alongside a 24% appreciation in the shekel against the USD. Combined together, the TA-35 delivered a118% gain in USD-terms.

This creates a feedback loop in which stronger markets and a stronger currency reinforce one another. For foreign investors, this alignment can enhance both entry conditions and potential returns.

Institutional investment strategies further amplify this dynamic. Global funds reallocating toward markets demonstrating relative strength can increase exposure to Israeli assets, adding momentum to both market performance and currency appreciation. In such an environment, the shekel becomes both a reflection of investor confidence and a driver of broader market momentum.

Also, the strengthening of the shekel is good news for many Israelis. The strengthening of the shekel is leading to price reductions in retail chains, airline tickets, and overseas shopping, and supports Israeli consumers by lowering inflation. This is fueling Israeli consumption as the war begins to wane.

Israeli importers and retail chains benefit significantly from the strengthening shekel. Expenses are in cheaper foreign currency and revenues are in strong shekels.

One example of this dynamic can be seen in the Israeli stock Neto Malinda, a food importer our firm currently holds. Although the company does not officially disclose FX impact, estimates suggest that every 1% strengthening of the shekel adds about 17 million shekels to its bottom line.

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IMPORTANT DISCLOSURES & RISK INFORMATION

This content is provided for educational and informational purposes only and does not constitute investment advice, a solicitation, or an offer to buy or sell any securities. Investing in international markets, including the Israeli stock market, involves material risks, including but not limited to currency risk and the potential loss of principal. Wise Money Israel does not guarantee any specific outcome, return, or profit. Individuals should consult with a qualified financial advisor, tax professional, and/or legal counsel before making any investment decisions. Diversification does not necessarily ensure a profit or protect against loss. © 2026 Wise Money Israel. All rights reserved.

The post Why a strong shekel is attracting foreign investors to Israel’s capital market appeared first on Wise Money Israel.

For faith-driven investors, managing money is never just about returns. It is a declaration of values, a stewardship of blessing, and an expression of covenant faith.

Biblically responsible investing (BRI) asks one foundational question: Is my portfolio honoring God?

This guide outlines one approach to building a faith-based portfolio that aligns with Scripture, and discusses how investing in Israel’s flourising stock market may be considered within a broader truly biblical investment framework.

Wise Money Israel, an Israel-based SEC-registered investment advisory firm, provides specialized guidance and serves as your guide at every step, bridging the gap between biblical conviction and market expertise.

What Is Biblically Responsible Investing?

Quick Answer:

Biblically responsible investing, also known as BRI, is a values-based investment strategy that aligns a portfolio with Christian or Jewish scriptural principles. It combines negative screening (excluding immoral industries) with positive screening (actively investing in areas that reflect God’s purposes, such as aligning with Israel). BRI treats financial stewardship as an act of faith, not just a financial decision.

Biblically responsible investing goes far beyond simply removing “sin stocks” from a portfolio. It is a proactive, purpose-driven discipline that asks: Where is God at work in the world, and can my capital follow?

While traditional BRI screens exclude companies involved in abortion, pornography, gambling, or predatory lending, a fully developed biblical portfolio also intentionally invests in companies and markets aligned with human flourishing, innovation, and God’s redemptive purposes.

For millions of Christian and Jewish investors, that conviction leads directly to Israel, the Land at the center of Scripture’s great promises.

Why Israel Is the Cornerstone of Biblical Investing in 2026

Israel’s modern economic rise is one of the most compelling stories in global finance. From a nation established against all odds, Israel has grown into a world-leading innovation hub - the “Startup Nation,” - driving breakthroughs in technology, agriculture, renewable energy, healthcare, and infrastructure.

But for the biblically minded investor, Israel’s significance runs even deeper. Scripture describes the restoration of Israel as one of the defining movements of the end times. Investing in Israel is participating in that restoration; tangibly, financially, and faithfully.

The Financial Case for Investing in Israel’s Stock Market

• Tel Aviv 35 Index outperformance: Israel’s flagship stock benchmark has outperformed America’s S&P 500 over various periods (the last 1, 2, 5, 10, 20 and 25-year periods in dollar terms), illustrating the historical performance of the Israeli market relative to U.S. benchmarks during these periods. Of course, past performance is not a guarantee of future results, market conditions vary significantly and there could be periods where Israeli’s stock benchmark does not beat the S&P 500.
• Shekel appreciation: International investors should be aware that fluctuations in the USD/ILS exchange rate will impact total returns, providing the potential for either currency gains or losses in addition to market performance. The Israeli shekel has appreciated against major currencies (almost 60% over the USD in the past 24 years), this presents international investors potential currency gain or loss in addition to market returns.
• NASDAQ leadership: For those seeking to concentrate on the tech sector, Israel has more NASDAQ-listed companies per capita than any country outside the United States, a measure of its tech-driven growth.
• Diversification opportunity: Based on historical data from 2010–2025, Israeli equities have shown different performance cycles than U.S. markets. This may offer an opportunity for portfolio diversification alongside faith-based alignment.

The Biblical Case for Investing in Israel

• Genesis 12:3: God’s covenant promise to bless those who bless Israel is foundational to the biblical investing thesis for many faith-driven investors.
• Psalm 122:6: “Pray for the peace of Jerusalem.” Investing in Israel’s economic health is a tangible expression of solidarity with the Jewish people and land.
• Prophetic restoration: From Isaiah to Ezekiel, Scripture foretells Israel’s rebuilding. Faith-based investors increasingly see Israeli market participation as alignment with that prophetic narrative.

How to Build a Biblically Responsible Portfolio: 6 Steps

The following steps reflect WMI’s framework for building a faith-based investment portfolio that integrates biblical principles with sound financial strategy and Israel’s market at the core.

Step 1: Define Your Biblical Values and Financial Goals

Every biblically responsible portfolio begins not with market data, but with conviction. Before selecting a single investment, clarity on your values determines everything that follows.

Key questions for faith-based investors to answer first:

• Which industries or business practices conflict with my biblical convictions?
• Do I feel called to actively support Israel and the Jewish people financially?
• What is my investment time horizon, income need, and risk tolerance?
• Am I seeking growth, income, preservation of wealth, or a balanced combination?

At Wise Money Israel (WMI), every client relationship begins with these questions. Your convictions shape your portfolio, not the other way around.

Step 2: Screen Out Investments That Conflict with Your Faith

Negative screening removes investments that violate biblical standards. Most investors are surprised to discover how many conventional index funds contain holdings in industries that contradict their faith.

Common biblical exclusion screens include:

• Abortion and abortifacient pharmaceutical companies
• Pornography and adult entertainment producers
• Gambling operators and predatory lenders
• Companies that actively undermine religious liberty or traditional family values
• Businesses with significant ties to nations openly hostile to Israel

WMI advisors conduct thorough market audits, identifying these conflicts and choosing holdings to ensure your investments reflect your faith, not contradict it.

Step 3: Pursue Positive Impact, Invest Where God Is Moving

The most powerful dimension of biblically responsible investing is its forward-looking, positive focus. This is where Israel’s stock and bond market becomes a central opportunity for faith-driven investors.

Israel’s ongoing economic rebuilding efforts provide current opportunities for faith-driven investors to consider as part of a long-term allocation strategy.                      

Growing Israeli sectors aligned with biblical values:

• Technology & Cybersecurity: Israel’s “Startup Nation” innovation is a global leader in AI, cybersecurity and many other world-leading technologies.
• Renewable Energy: Solar energy and water desalination technology that reflects stewardship of God’s creation.
• Agriculture: Israeli expertise in making the desert bloom, a literal fulfillment of Isaiah 35:1, is producing global food security solutions.
• Infrastructure & Tourism: Transportation, housing, and tourism projects supporting Israel’s ongoing economic initiatives.

Because WMI is headquartered in Israel, we provide on-the-ground market intelligence. We know these sectors, the companies within them, and the opportunities that are emerging right now.

Step 4: Diversify Wisely Within Your Biblical Framework

Biblical wisdom affirms the importance of diversification. Ecclesiastes 11:2 counsels: “Divide your portion to seven, or even to eight.” This ancient principle maps directly onto modern portfolio theory.

A balanced biblically responsible portfolio may include:

• Israeli equities across multiple sectors (technology, food production, energy, etc.)
• Biblically screened Israeli stocks in Israel and abroad meeting faith-based criteria
• Fixed-income instruments from companies that meet faith-based criteria

WMI advisors construct allocations tailored to each client’s unique goals, risk profile, and faith convictions, ensuring both financial integrity and biblical alignment.

Step 5: Partner with a Faith-Driven, Israel-Based Advisor

Proverbs 11:14 reminds us: “In an abundance of counselors there is safety.” Choosing the right advisor may be the most consequential step in building a biblically responsible portfolio, especially when your strategy centers on the Israeli market.

Most advisors who claim expertise in biblical investing may never have set foot in Israel. Wise Money Israel is different.

Why Wise Money Israel?

Most investment advisors talk about Israel from a distance. WMI lives it.

• Israel-based team with firsthand market access and on-the-ground insight
• Faith-driven approach that integrates biblical principles into every investment decision
• Extensive experience navigating the Tel Aviv Stock Exchange for international investors

When you work with WMI, you are not simply hiring a financial advisor. You are partnering with a team that believes what you believe, stands where you stand, and sees Israel’s potential through the same lens of faith.

Step 6: Monitor, Review, and Stay Aligned Over Time

Building a biblically responsible portfolio is an ongoing commitment, not a one-time decision. Markets evolve, companies change their practices, and your own life circumstances shift. Regular portfolio reviews ensure continued alignment between your investments and your values.

WMI’s ongoing advisory support includes:

• Regular performance updates on Israeli market sectors and the Tel Aviv indices
• Updating your Israeli portfolio when holdings fall out of alignment with your biblical screening criteria
• Educational resources on Israel’s economic developments and market movements
• As Israel’s market evolves, WMI provides strategic rebalancing to keep your portfolio aligned with your goals

Frequently Asked Questions About Biblical Investing and Israel

These questions reflect what investors most frequently ask when exploring biblically responsible investing and Israel’s stock market.

What does the Bible say about investing?

The Bible consistently affirms wise financial stewardship. Proverbs 13:11 teaches that “whoever gathers money little by little makes it grow.” Ecclesiastes 11:2 counsels diversification. Matthew 25 (the Parable of the Talents) teaches that God expects us to grow what He has entrusted to us actively. Biblical investing applies these principles to modern portfolio management.

How do I start investing in the Israeli stock market?

The most effective way for international investors to access Israel’s stock and bond market is through a trusted Israel-based advisor like Wise Money Israel. WMI provides direct accefss to Tel Aviv Stock Exchange opportunities, sector-specific guidance, and Israel-based expertise that helps investors navigate the market with confidence and biblical conviction.

Why should Christians invest in Israel?

Christians who take Genesis 12:3 seriously - God’s promise to bless those who bless Israel - see investing in Israel’s economy as a natural extension of that covenant commitment. Beyond the biblical rationale, Israel’s technology-driven economy has produced notable market performance, making it both a biblical and financially compelling choice.

Is it safe to invest in Israel right now?

All markets have volatility.

Israel’s economy has historically maintained functionality during periods of conflict. While this historical trend exists, prospective investors must carefully consider that regional instability poses unique and significant risks to capital preservation and that past economic performance during conflict is not a guarantee of future stability.

Israel’s economy has maintained positive growth, even during periods of conflict. For example, Israel’s GDP averaged 1.9% between 2023-2025, and its economy did not go into recession during the seven-front war. That growth rate is in line with other OECD nations that were not at war during this timeframe (OECD average: 1.6%). Of course, historical resilience is not a guarantee of future stability.

For example, the Tel Aviv 35 Index has historically delivered strong long-term performance over many periods of time, as discussed above. Index performance is shown for illustrative purposes only, and indices are unmanaged and cannot be invested in directly.

For many investors, a managed account of diversified individual Israeli stocks may be an effective way to seek exposure to Israeli market dynamics while adhering to specific biblical criteria using WMI’s on-the-ground market intelligence.

What is the difference between ESG investing and biblical investing?

ESG (Environmental, Social, Governance) investing applies secular progressive criteria to portfolio selection. Biblical investing applies scriptural principles, which may align with some ESG screens but diverge on others. For example, biblical investors often specifically support Israel’s economy, a commitment that ESG frameworks do not address. BRI is grounded in faith conviction, not political ideology.

What sectors in Israel are best for faith-based investors?

Israel’s leading sectors for biblically aligned investors include technology and cybersecurity, renewable energy and water technology, precision agriculture, and infrastructure development. All of these contribute to human flourishing and align with values around stewardship and restoration. WMI provides specific sector guidance based on each client’s goals.

Can I invest in Israel through Wise Money Israel if I live in the United States?

Yes. WMI serves investors from 34 nations, including those based in the United States, providing access to Israeli market opportunities typically unavailable through domestic brokerages. As an Israel-based firm, licensed by the Israel Securities Authority and registered with the U.S. Securities and Exchange Commission (SEC), WMI offers the on-the-ground expertise and direct market access that international investors need to participate effectively in Israel’s economy.

Your Portfolio Can Be Both Profitable and Purposeful

The world’s financial markets offer many paths but only one invites you to invest in the fulfillment of biblical prophecy while seeking to meet your long-term financial objectives through the Israeli market. A biblically responsible portfolio anchored in Israel is not just an investment strategy. It is an act of faith.

Whether you are beginning your faith-based investing journey or seeking to add an Israel allocation to a global investment strategy, Wise Money Israel is ready to walk alongside you as your trusted fiduciary advisor on the ground in Israel and in your corner every step of the way.

Ready to Start Your Biblical Investing Journey?

Connect with Wise Money Israel today to explore how to build a portfolio that honors your faith, supports Israel, and pursues a strategy centered on your investment objectives.

Start Your Biblical Investing Journey Today

IMPORTANT DISCLOSURES & RISK INFORMATION

This content is provided for educational and informational purposes only and does not constitute investment advice, a solicitation, or an offer to buy or sell any securities. Investing in international markets, including the Israeli stock market, involves material risks, including but not limited to regulatory differences. All investment opportunities carry risk, including the potential loss of principal. Wise Money Israel does not guarantee any specific outcome, return, or profit. References to biblical principles and scriptures are provided for contextual and motivational purposes and do not constitute financial, legal, or tax advice. Individuals should consult with a qualified financial advisor, tax professional, and/or legal counsel before making any investment decisions. Diversification does not ensure a profit or protect against loss. © 2026 Wise Money Israel. All rights reserved.

The post Building a Biblically Responsible Portfolio: A Step-by-Step Guide to an Israel-Centered Faith-Based Investing appeared first on Wise Money Israel.

For faith-driven investors seeking to align their portfolios with biblical principles while pursuing disciplined, long-term investment outcomes, Israel offers a unique opportunity. Investing in Israeli companies allows participation in innovation, rebuilding, and stewardship in the land central to biblical history—while remaining mindful of market risk.

Even as Israel faced a seven front war, its stock market surged over the past two years (over 111% growth, or 150% in USD-terms).

Disclosure: of course index performance doesn’t represent the performance of any client account nor guarantee future results. USD-terms index comparisons, TA-125 vs. S&P 500: 1-year: 81% vs 18%, 5-year: 138% vs 82%, 10-year: 298% vs 259%. Indices are unmanaged, do not reflect the deduction of fees, expenses, or taxes, and that an investor cannot invest directly in an index. Investing involves risk, including the loss of principal. Exchange rate fluctuations can significantly reduce or eliminate investment returns for U.S. dollar-based investors. Index performance does not include the reinvestment of dividends unless otherwise stated. Past performance does not guarantee future success.

As we start 2026, understanding the key economic themes influencing Israel’s recovery—and working with advisors who understand these dynamics from within Israel—becomes essential for informed investment decision-making.

Despite recent challenges, Israel’s economy has demonstrated resilience across multiple economic cycles. Independent rating agencies have indicated expectations for gradual stabilization and recovery, reinforcing the importance of thoughtful, long-term positioning rather than short-term speculation. Standard and Poor’s (S&P) recently revised Israel’s credit outlook to stable, and affirmed its A- rating, expecting a 5% GDP growth rate in 2026 (U.S. at 2%).

A High-Level View of Key Growth Themes in Israel

Rather than focusing on forecasts or predictions, many investors consider structural themes shaping Israel’s economy as it rebuilds:

• Technology and innovation
• Renewable energy and environmental solutions
• Infrastructure, housing, and national development

These themes reflect areas where Israel has demonstrated long-standing expertise and where rebuilding efforts may create sustained economic activity over time.

Key Economic Themes in Israel’s Rebuilding Economy

 This discussion is thematic and educational in nature and does not constitute investment advice or a guarantee of future results.

1. Technology and High-Tech: Israel’s Innovation Ecosystem

Israel’s reputation as the “Startup Nation” reflects decades of investment in education, research, and technological problem-solving. Even during periods of geopolitical stress, Israel’s technology sector has remained deeply integrated into global markets.

Key areas of innovation include:

• Artificial intelligence applications across healthcare, security, and business systems
• Cybersecurity solutions addressing growing global digital risks
• Life sciences and biotechnology focused on improving quality of life
• Financial technology aimed at efficiency and accessibility

For biblical-minded investors, this sector reflects the application of creativity, wisdom, and human ingenuity to real-world challenges. As stability improves, continued research and development activity is expected to remain a meaningful contributor to Israel’s economy.

Advisors based in Israel are often able to assess these companies within their local business, regulatory, and cultural context—an important consideration when investing in international markets.

2. Renewable Energy and Environmental Technologies: Stewardship in Practice

The ancient principle of resource stewardship finds modern expression in Israel’s focus on renewable energy, water technology, and environmental innovation. Israel’s geographic conditions and resource constraints have driven decades of advancement in areas such as solar energy, desalination, and precision agriculture.

Examples of long-term environmental themes include:

• Solar power development and related infrastructure
• Water treatment, reuse, and efficiency technologies
• Energy storage and grid resilience solutions
• Agricultural water management and sustainability

Over the past six decades, Israel has emerged as a global leader in water technologies, pioneering innovations such as drip irrigation (which is now in used in over 100 countries), large-scale desalination, wastewater recycling (85%-90%, highest in the world), smart water networks, and desert agriculture. Driven by scarcity, Israel transformed necessity into expertise, exporting water solutions that are now used worldwide. These advances have influenced agriculture, urban infrastructure, and sustainability practices across multiple continents.

These areas support both economic development and responsible resource management. Investors interested in aligning capital with stewardship values may find this theme particularly compelling, while remaining aware that environmental and clean-tech investments can involve regulatory and technological risks.

3. Infrastructure and National Development: Building for the Future

Over the past two years, Israel’s north and south have borne the brunt of prolonged conflict, making rebuilding a national priority rather than a cyclical phase. Periods of rebuilding often involve significant investment in infrastructure, housing, transportation, and essential services. In Israel, these efforts play a critical role in economic normalization, employment, and long-term growth.

Infrastructure-related themes include:

• Transportation and logistics modernization
• Housing development and urban renewal
• Energy and utility systems
• Public-private partnerships supporting national development

From a biblical perspective, the rebuilding of Israeli communities in the Land reflects enduring principles of restoration. From an investment standpoint, exposure to infrastructure related activity can also contribute  diversification benefits within a broader portfolio.

Biblical Principles and Disciplined Investing

Biblical investing in Israel is not about speculation or certainty—it is about aligning capital with values while exercising prudence and humility.

Key principles often considered by faith-driven investors include:

• Stewardship and accountability
• Long-term thinking rather than short-term reaction
• Ethical conduct and respect for human dignity
• Diversification and risk awareness

Working with advisors who understand both financial markets and biblical values can help investors integrate faith considerations into a disciplined investment framework.

Working With Israel-Based Investment Advisors

Investing internationally involves currency exposure, geopolitical considerations, regulatory differences, and market complexity. Investment advisors who live and work in Israel bring local perspective that can complement global investment experience.

Such licensed advisor can help investors:

• Understand Israeli market structure and regulation
• Evaluate opportunities within broader portfolios
• Navigate periods of uncertainty with long-term discipline
• Maintain alignment between financial goals and personal values

Wise Money Israel offers investment management services grounded in direct familiarity with Israeli markets, language, and business culture, serving clients who value thoughtful, faith aligned investing informed by local insight. For those seeing to explore this approach further, a free introductory consultation is available through our website.

Wise Money Israel provides investment management services with on-the-ground Israeli market knowledge and language, serving clients who value thoughtful, faith-aligned investing.

Conclusion: Positioning Thoughtfully as Israel Rebuilds

As Israel continues its path of recovery and rebuilding, themes such as technology, environmental innovation, and infrastructure are likely to remain central to its economic development.

Investing in Israel is not simply a tactical financial decision—it is a long-term commitment that benefits from patience, discernment, and trusted guidance. By partnering with experienced, Israel-based advisors, investors can pursue their financial objectives while honoring biblical principles.

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The post Biblical Investing in Israel: 3 Growth Themes Shaping the Israeli Stock Market as Israel Rebuilds in 2026 appeared first on Wise Money Israel.

The shift in sentiment accelerated as geopolitical risk began to ease. Following military operations in the north against Hezbollah and a brief but intense conflict with Iran, markets started to price in a lower risk premium. That reassessment coincided with firmer economic signals, including renewed growth, rising foreign investment, and a strong recovery in equity prices.

Deal activity played a central role. A landmark natural gas export agreement with Egypt – the largest in Israel’s history – committed the supply of roughly 130 billion cubic metres of gas through 2040 in a deal valued at about $35 billion, underscoring the scale of prospective foreign-currency inflows and reinforcing Israel’s position as a regional energy supplier. Alongside energy, defense exports expanded sharply. Strong battlefield performance translated into a growing pipeline of procurement orders – from major contractors to smaller specialist firms – creating steady demand for shekels.

Technology exits amplified the effect. The announced acquisition of Israeli cyber company Armis by ServiceNow in a cash deal valued at roughly $7.75 billion – one of the largest technology exits in Israel in recent years – bolstered the currency even before funds had entered the country. Market participants treated the announcement itself as a signal of confidence in Israel’s high-tech sector and its ability to generate large-scale US dollar inflows. Such deals tend to trigger anticipatory positioning by investors and institutions, reinforcing the shekel’s strength through expectations of future currency conversions, employee payouts, and reinvestment flows. In this sense, sentiment and signalling proved nearly as powerful as the capital movements themselv

Capital flows from institutional investors provided an additional tailwind. Gains in global equities prompted Israeli companies with foreign exposure to trim US dollar positions as part of routine hedging adjustments, supporting the Israeli shekel. The resulting rise in asset values helped sustain this pattern, embedding it in currency markets.

Currency strength did not emerge in isolation, and Israel’s equity market reflected the same shift in sentiment. The Tel Aviv Stock Exchange closed 2025 with gains of 51.6%, following a 28.4% rise the previous year, even amid prolonged security tensions. The gains were led by technology, defence, energy and financial stocks – sectors closely aligned with the forces supporting the shekel.

A stronger Israeli currency helped contain import costs in an economy that remains heavily dependent on foreign goods. With Israel importing close to $92 billion worth of goods in 2024, the shekel’s appreciation eased price pressures across energy, food, and manufactured inputs, while improving balance-sheet conditions for domestically focused companies. In the meantime, international investors, encouraged by calmer security conditions improved macro signals, increased exposure to Israeli assets. The rally underscored a broader point: the shekel’s strength was not an abstract monetary development, but the byproduct of sustained capital inflows interacting with a trade-intensive economy.

For households, however, the most immediate effect of a stronger shekel was felt in prices. Currency appreciation helped moderate import costs, contributing to a 0.5% decline in the consumer price index in November. Annual inflation stabilised at 2.4% placing it squarely within the Bank of Israel’s target range of 1% to 3%. At a time when many economies continued to struggle with persistent price pressures, the Israeli shekel acted as a disinflationary force.

Israeli policymakers, however, remained cautious. While goods inflation eased, services inflation – less sensitive to exchange-rate movements – remained elevated. A tight labor market, characterized by low unemployment and high job vacancies, continued to exert upward pressure on wages. Fiscal uncertainty added to the caution, as budget discussions pointed to a widening deficit.

Against this backdrop, the Bank of Israel maintained a cautious stance. After cutting interest rates by 0.25% in November, the central bank signalled no urgency to move further, despite market speculation. Policymakers stressed that exchange-rate strength was only one consideration, alongside growth, labor-market conditions, fiscal discipline, and security risks.

That restraint reflects the trade-offs inherent in a stronger currency. Exporters face margin pressure, and a sustained rally can test competitiveness. Even so, economists argue that Israel’s export base – centred on high-value technology, defense, and energy – has so far shown sufficient resilience to withstand a stronger shekel.

Taken together, the shekel’s appreciation of 14.3% in 2025 against the US dollar captured a change in how markets priced Israel’s economic and geopolitical outlook. Improved security conditions, large-scale export activity, capital inflows and a resilient corporate sector combined to support the currency at a time when policy remained deliberately cautious. Whether the strength proves durable will depend less on exchange-rate policy than on the balance between growth, fiscal discipline and regional stability. For now, the shekel stands as a signal of renewed confidence, moderated by the constraints and risks that continue to influence Israel’s economy.

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The post The Shekel’s Comeback: How Currency Strength Reshaped Israel’s Markets and Inflation in 2025 appeared first on Wise Money Israel.

Nvidia’s multi-billion-shekel investment is neither symbolic nor incidental. With the ability to deploy capital almost anywhere in the world, Nvidia chose to place long-lived, mission-critical AI infrastructure in Israel—signaling confidence in the country’s technological depth and long-term reliability.

👉 Continue to the full article

The post Nvidia’s ‘Second Home’: Why the AI Giant Is Doubling Down on Israel appeared first on Wise Money Israel.

To understand where Israel is today, one must see how its past cultivated many of its present strengths. From its very early days, Israel made heavy investments in education, science, and defense. The famous Unit 8200 (the intelligence corps’ signals unit) trained many of the people who later left government service to found tech firms. Those roots in military R&D are not some odd byproduct of necessity – they shaped a culture of rapid prototyping, of solving hard problems under pressure, and of intense collaboration. These are precisely the qualities investors seek in frontier markets. As Jonathan Medved’s OurCrowd shows, even relatively young investment platforms in Israel tap into that reservoir of domestic talent in science, engineering, cybersecurity, AI – areas where global growth is high.

Over the decades Israel has transformed. No longer only a defensive frontier, it has become “Startup Nation” because every new wave of crises has been matched by waves of new enterprise. In the late 1990s and early 2000s, Israel’s high-tech sector was already expanding rapidly, becoming a key driver of the economy. The Shoresh Institution’s research confirms that high-tech’s share of GDP nearly doubled from 9% in 1995 to over 17% by 2000, then remained relatively stable through the following decade, with renewed returning after 2018.

Today, investors see beyond metaphor, they actually see numbers. Foreign direct investment (FDI) has been growing over the past decade. Even during times of conflict – yes, even war – investment into Israeli tech has shown surprising resilience. In the first six months of 2025, Israeli startups raised about $9.3 billion in private capital across 365 funding rounds, up 54% from the second half of 2024. What changed in composition matters: more large rounds in mature companies, more emphasis on cybersecurity, fintech, enterprise software. These are bets not on hope, but on proven capacity.

If the past built the foundation, the present is testing it under real weight. The war that broke out in October 2023 posed many risks – geopolitical, operational, human. Some international investors hesitated. Some companies saw business disruption. Yet many others leaned in, recognizing that the long-term story of Israel is not about war alone, but about deep technology, export orientation, government support, and global partnerships. The Israel Innovation Authority, the emphasis on export accounts, the trade surpluses in certain sectors even amid conflict – all of this signals that the economy has more than one pillar.

Sources: Bank of Israel, IVC Data and Insights, Central Bureau of Statistics, CapIQ as of July 7, 2025. (1) 2024A Full Year Numbers. Central Bureau of Statistics as of December 31, 2024 . (2) Bank of Israel’s Research Department Staff Forecast Report (July 7, 2025). (3) As of May 31, 2025.

Let me share a story of two investor archetypes (without naming names) that illustrates how past and future collide. First, there’s the global institutional investor – let’s say it is a sovereign wealth fund – that came into Israel years ago, drawn by highly skilled engineers and access to defense-technology start-ups. Over time that investor saw healthcare start-ups, AI firms, quantum research, and agro-tech. They stayed through turbulence because the tailwinds of innovation were strong, and because they believed Israel’s institutions – its universities, its venture ecosystem – would continue to deliver. Then there’s the founder-investor, someone who served in the IDF, left with connections, a mindset of solving mission-critical problems, then built a company that got acquired by a tech giant. That person then reinvests in new start-ups, mentors, builds incubators. That loop – founder to re-investor to founder again – is part of what powers the bridge between past and future. It is not mythical; it is visible in firms like Jerusalem Venture Partners, in OurCrowd, in many smaller players. Corner Ventures+3Wikipedia+3Wikipedia+3

Looking ahead, what should potential investors watch for – and what makes Israel not just interesting, but potentially exceptional?

First, deep tech. Israel now has over 1,500 Deep Tech companies, and since 2019 those companies have attracted over $28 billion in investments. Fields like photonics, quantum computing, digital health, advanced manufacturing, food-tech – all are growing rapidly from strength. Second, cybersecurity remains a core asset. In periods of relative calm or conflict, demand for cybersecurity and related tech only increases. Israeli firms are globally competitive there. Third, mature rounds are becoming more important – less speculation, more scaling. Investors are increasingly backing companies beyond seed stages, betting on traction and revenue as well as on the promise of what might yet be.

Yet, challenges remain, and no bridge is without its gaps. Geopolitical risk is real. Investor sentiment is fragile; legal or regulatory changes can carry outsized weight in perception. Infrastructure and cost pressures (real estate, talent competition, international liability etc.) are growing. And while many companies export, Israel is relatively small, which means scaling globally is not optional but essential. Also, the macro picture – fiscal deficits, war-driven expenditures, debt burden – ask for caution.

What Israel offers, if one leans in, is something uncommon: a place where past lessons in survival, innovation, academic strength, and problem-solving under constraint combine with a future orientation that seeks not merely growth but global leadership in next-generation challenges. It is a kind of “investor’s dialectic” where you carry forward history’s tools but always ask: what next?

For many, the lure is that bridge itself. The reliability of past performance gives credibility; the uncertainties ahead bring opportunity. To stand on that bridge is to acknowledge risk and reward together–not to choose between them. If you understand both Israel’s scars and its ambitions, you start not with fear, but with curiosity. And sometimes, that is what leads to the best investments.

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In the photo from right to left: Prof. Eugene Kandel, TASE Chairman; Seffy Zinger, Chairman of the ISA; Bill Ackman, CEO of Pershing Square Capital Management, L.P. and Ittai Ben Zeev, TASE CEO. Photographer: Elad Gutman. Free of charge.

Bill Ackman’s investment firm manages approximately $20 billion, making him one of the notable hedge fund managers in today’s market. Mr. Ackman last year took an approximate 5% stake in the Tel Aviv Stock Exchange through his own personal funds (a first for Mr. Ackman). Mr. Ackman noted that his investment in the TASE stock was “probably the best investment I’ve ever made”, referring to his almost 300% return in under two years (gaining him $73 million). He indicated that he does not intend to sell his shares.

“The value of a country is the value of its total assets minus its liabilities. The liabilities are the national debt. The assets are the people, the intellectual property, the companies, the land. In Israel’s case, the value of its assets — especially its intellectual assets — far outweighs its liabilities.” - Bill Ackman

The billionaire indicated that he intends to invest another $1 billion in companies in Israel.

Mr. Ackman, a Jewish-American billionaire, outspoken Zionist, and one of Wall Street’s most prominent activist investors, is also a notable public figure recognized for his vocal advocacy against antisemitism and his strong support for the State of Israel, particularly since the outbreak of the "Swords of Iron" war on October 7, 2023.

Bill Ackman said during the ceremony: “After October 7th, I realized there was a much bigger problem in the world. That realization came from my own university [Harvard University], where 34 student organizations released a letter saying that "Israel is solely responsible for the acts of Hamas," even though Hamas was still operating on Israeli soil. One of the worst days of my life was October 7^th.

Owning an exchange is like owning a royalty on the success of a country. And I said very publicly at the time that I thought there's no better time to invest in Israel.

As bad as October 7th has been for Israel, for Jewish people, for the world, a lot of good has come out of it. I think if you look at the last less than two years, there's been a complete reset of the Middle East situation in a way that I think is extremely favorable for Israel. I think we're close to the end of this war, and I think we're on a path to prosperity and peace. I'm very optimistic about the future. I think the Abraham Accords are going to get expanded.”

Seffy Zinger, Chairman of the Israel Securities Authority: "The performance of the Israeli capital market – and its leading indices over the past two years – serves as a reflection of the Israeli economy as a whole, showcasing exceptional resilience and strength. These results are thanks to the executives of Israel’s leading public companies present here today, as well as the investors, including foreign investors, who have demonstrated and continue to demonstrate confidence in the Israeli economy. A clear example of this confidence was Bill Ackman’s decision to purchase 4.99% of TASE shares at the beginning of 2024, right in the midst of the war. This was a significant vote of confidence in Israel and in the Israeli capital market. The Israeli capital market can and should be a leading player and an integral part of the global financial system, and we are taking concrete steps to make this happen. The transition to a Monday–Friday trading week is part of this strategic vision – a step that will bring the Israeli capital market closer to international investors and strengthen Israel’s position as an attractive investment destination on the global stage.”

“It’s a country that has proven itself exceptionally over the past two years, both militarily and technologically. Israel has also proven itself as a democracy. It’s a country where many people feel comfortable criticizing their leader — and that’s a good sign.” - Bill Ackman

Ittai Ben-Zeev, TASE CEO: “We are proud to host Bill Ackman, one of Israel’s greatest friends, here at the Tel Aviv Stock Exchange, a symbol of Israel's economic resilience. The last two years have been very challenging for the Israeli economy and the local capital market in the wake of the war. Despite these challenges, TASE has reached record highs, reflecting the robustness of the Israeli economy. Much of this success is a testament to the resilience and strength of Israeli society and our public companies.”

Sources: TASE, Ynet, Globes

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For over three decades, the spectre of the "Iranian threat" has hovered over Israel’s economic horizon. It was more than just a geopolitical talking point. It was a risk premium built into every investment model, every sovereign bond, every long-term economic forecast. The country has functioned under that shadow. Now, Israel’s decisive military action is viewed by markets as a long-term stabilizer. Moreover, the perceived success in its confrontation with Iran is likely to reduce the geopolitical risk premium that has long shadowed the Israeli economy. While such assessments may seem detached amid mourning and military tension, they reflect what investors ultimately seek: a transition from prolonged uncertainty to a more defined and manageable risk environment. For capital markets, risk that is addressed is often less dangerous than risk that looms undefined.

One of the defining features of the Israeli financial system is its familiarity with volatility. From suicide bombings in the early 2000s to wars in Lebanon and Gaza, the economy has been tested - and has repeatedly adapted. The market has learned to deal with crises. Though markets tend to react to emotions, they eventually respond to risk and reward. And Israel’s markets, in particular, have learned how to filter out the emotional noise. Compare last week’s missile strikes with the panic of October 7, 2023, when Hamas launched a brutal assault on Israeli civilians. Back then, the stock market plummeted 6.5% in a single day. This time, the opening dip was quickly reversed, and the day ended in green territory. The conclusion? Investors are no longer reacting to every headline. They are evaluating fundamentals - and seeing strength beneath the surface.

Since the beginning of 2025, over NIS 4 billion has flowed into Tel Aviv’s stock indexes. That’s not a fluke. It reflects growing confidence in Israel’s ability to navigate stormy waters. While many retail investors still favour U.S. markets like the S&P 500, there is vast untapped potential for domestic inflows - especially as yields on government bonds remain attractive and geopolitical risk potentially recedes. The bond market, too, is showing signs of stability. Despite heightened tensions, 10-year Israeli government bonds are only down slightly, and longer-dated issues still offer yields around 5% - an appealing rate in a world of uncertain central bank policy. If the geopolitical environment calms, it could pave the way for interest rate cuts, further supporting equity valuations.

Judging by recent developments, the shift isn’t about euphoria of winning the war with Iran - it’s about the recalibration of risk. For long-term investors, the most important question isn’t what the headlines say today, but whether the fundamental risk profile has improved compared to last week. And the answer, according to the data, appears to be yes. That alone can encourage a renewed flow of foreign investment - and possibly a strengthening of the shekel as a result.

Perhaps the greatest strength of the Israeli economy lies in its discipline and long-term orientation. Investors who adopt a measured, forward-looking mindset - rather than reacting to every market tremor - are better positioned to benefit from the resilience that defines Israel’s financial landscape. It is an economy managed by institutions and guided by experience, where decisions are shaped by fundamentals, not fear. In an age dominated by headlines and emotional swings, this steadfast approach offers a rare kind of stability.

The Israeli market has shown time and again that it is not driven by emotion, but by the economic consequences of events. Conflict and loss, while deeply tragic, are not new to this region – and the economy has evolved to keep moving forward even amid uncertainty. History has proven that downturns tend to be followed by recoveries, and that the most enduring opportunities often emerge in the aftermath of crisis. For those with patience and perspective, the Israeli economy continues to signal not fragility, but quiet strength.

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Artificial Intelligence (AI)

Cybersecurity

Digital Health

Navina is an Israeli-founded healthcare technology startup company that develops an AI-powered clinical intelligence platform aimed at enhancing value-based care. Established in 2018 by CEO Ronen Lavi and CTO Shay Perera, the company operates its research and development center in Tel Aviv and maintains its commercial headquarters in New York City. Navina's AI copilot integrates with electronic health record systems to transform fragmented patient data into concise, actionable insights, thereby reducing administrative burdens and improving diagnostic accuracy for clinicians.

In March 2025, Navina secured a $55 million Series C funding round led by Goldman Sachs, bringing its total funding to $100 million. Navina's platform is currently utilized by over 10,000 healthcare professionals across 1,300 clinics, supporting the care of more than three million patients. The company has established partnerships with organizations such as Agilon Health, InnovaCare Health, Millennium Physician Group, and Privia Health. In recognition of its impact, Navina was awarded the 2025 Best in KLAS for Clinician Digital Workflow.

How Tech Companies are Adapting

Israeli tech companies continue to demonstrate resilience and innovation. They are showing remarkable adaptability in 2025, navigating a complex landscape shaped by geopolitical tensions, economic challenges, and rapid technological advancements. They are adapting their business models to the changing reality, investing in new technologies, and exploring new markets.

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In 2023, Israel’s life sciences ecosystem included approximately 1,800 active companies employing around 78,000 people. These companies span fields such as biotechnology, digital health, medical devices, and pharmaceuticals. Although total private investment dropped sharply—from $3.3 billion in 2022 to $1.7 billion in 2023—over $1 billion of that came from foreign investors. That level of international backing, still higher than pre-2019 figures, reflects sustained global confidence in Israeli innovation.

Venture capital-backed deals have become more concentrated, but non-VC-backed investment remains significant, suggesting broad-based interest that extends beyond traditional funding models. Much of that interest is rooted in Israel’s unique ability to fuse high-tech capabilities with cutting-edge healthcare solutions. This includes advances in AI-powered drug discovery, personalized digital medicine, and bio convergence - the integration of biology, engineering, and data science. Israeli companies are also making notable strides in eye and vision technologies, fertility treatments, rare disease research, and neurological care - areas experiencing growing global demand and offering investors early access to high-growth opportunities.

Digital health alone accounts for about 30% of Israeli life sciences firms and exemplifies the country’s competitive advantage. With a robust digital infrastructure and world-leading cybersecurity expertise, Israel is reshaping how healthcare is delivered, monitored, and personalized at scale.

Supporting this momentum is a government fully committed to innovation. In response to the Iron Swords war in late 2023, the Israel Innovation Authority swiftly launched emergency grants to stabilize startups at risk, echoing the successful support strategies used during the COVID-19 pandemic. In 2024, several game-changing initiatives were announced:

• New Startup Fund: Over NIS 500 million will be co-invested with private investors to support early-stage companies.
• YOZMA 2.0: A revival of the original fund that kickstarted Israel's VC scene in the 1990s, this fund-of-funds structure will funnel over NIS 4 billion into Israeli VC firms over five years.
• Nationwide Innovation Centers: Nine new regional hubs will bolster R&D and high-tech employment across the country.
• Expanded Grant Programs: Enhanced Tnufa and Growth Fund support provide a more resourceful environment for startups in every lifecycle stage.

This need became particularly relevant as IPO activity on both the Tel Aviv and U.S. stock exchanges declined in 2023. However, follow-on offerings saw significant growth, with Israeli life sciences companies raising $432 million through secondary offerings in the U.S. - a 66% increase over the previous year. At the same time, acquisition activity remained strong, with 2023 marking the fourth consecutive year that included at least one deal exceeding $500 million.

Currently, many Israeli life sciences companies remain in the earlier stages of development, making private equity the primary route for investment. For public market investors, this may delay opportunities until the companies are listed, but the trend is temporary rather than structural. The strong international interest, particularly from foreign investors who contributed over $1.7 billion in 2023 despite global headwinds, is a clear signal: global players are watching Israel closely and positioning themselves for the long term success of Israeli innovation.

The convergence of Israel’s research excellence, entrepreneurial culture, government support, and global partnerships creates a uniquely fertile ground for investment. Despite geopolitical uncertainties and macroeconomic challenges, Israeli life sciences remain a strategic asset with long-term upside.

Investors - whether institutional, corporate, or private equity - can access diverse, high-potential opportunities across therapeutic verticals, diagnostics, AI health tech, and next-generation medical devices. Importantly, the Israeli ecosystem is not only resilient but adaptive, with a proven capacity to innovate under pressure and pivot in response to global challenges.

While many of today’s Israeli innovation opportunities are still in the private domain, the pipeline of maturing companies suggests that public investment prospects via Israeli stock will yield future successes - and when they do, being informed and ready will be key. The investors who understand the Israeli innovation ecosystem now will be better positioned to seize those opportunities as they emerge into the Israeli stock market.

In other words, in a global market searching for both performance and purpose, Israeli innovation is not just an opportunity - it is a strategic imperative.

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