Asset Class Performance Review, January To September 2025

The attached chart shows the performance of our benchmark funds in the main asset classes YTD to 30/09/2025.

Equities

The MSCI World Equity Index in Euro is up just over 3% year to date. It has recovered from a YTD low (in euro terms) of c. -16% back in April of this year. This recovery has occurred despite the weak dollar continuing to be a headwind for euro-based investors.

The last number of months has seen fears over tariffs, geopolitics and growing debt concerns give way to greater optimism about corporate profitability, economic growth and the positive impact of Artificial Intelligence.

It is hoped that the current momentum with equity markets can be maintained, but there continues to be risks that mean the journey is likely to continue to be a volatile one.

Bonds

The expectation is that the ECB has made its final interest rate cut of this calendar year. President Lagarde believes that the interest rate setting is appropriately positioned for the current environment with inflation expectations appearing to be contained within the Eurozone.

The series of interest rate cuts that the ECB engaged in between June 2024 to June of this year have provided a supportive backdrop for European bond markets. However corporate bonds have continued to outperform their government equivalent, as concerns over the debt level and fiscal deficit of France have weighted on their government bonds.

Property

There was further stabilisation of capital values in commercial property markets over the quarter. Solid income yields alongside these stabilising capital values have helped to produce positive performance across our main property fund managers.

Cash

The yields on our main Cash funds are currently c. 2% and are in line with the ECB deposit rate. Markets have priced in that there will be no further ECB interest cuts this year which will mean that cash fund returns should stabilise, albeit at relatively low levels.

Multi-Asset Funds

Balanced multi asset fund performance continues to improve @ c. 3% YTD. This reflects a continued recovery in equities over the 3^rd quarter. Their asset allocations are currently positioned to the more conservative end of their ranges as they continue to lean on their diversification assets of Cash, Bonds, Alternatives (including Gold) and Property to help to reduce overall volatility.