Investment portfolios delivered solid results in Q4 2025, capping another strong year of performance across strategies. While markets were more volatile toward year-end, disciplined portfolio management, selective rebalancing and diversification supported returns, with full-year outcomes outperforming peers. Looking ahead to 2026, portfolios remain positioned cautiously, balancing attractive income and defensive assets against elevated valuations and ongoing geopolitical and economic uncertainty.

The third quarter of 2025 delivered another period of positive investment outcomes across our portfolios. Compared with the prior quarter, it was a quieter few months from a headlines perspective, as markets continued their steady upward trend.

Discover key insights from the Q2 2025 Investment & Market Update by Arrow Private Wealth. Explore expert analysis on economic trends, equity performance, inflation, and portfolio strategy.

The final quarter of 2024 delivered tamer performance across portfolios, rounding out a strong year for investment performance. It was a choppy quarter, as strong returns in November offset declines and flat returns in December and October. The quarter was eventful, with significant developments such as the US Presidential election and interest rate cuts from the Federal Reserve.

The third quarter of 2024 delivered strong performance across portfolios, with solid contributions from various asset classes. It was a volatile quarter, marked by sharp declines in early August, followed by a steady recovery through the remainder of the period. The quarter was eventful, with significant developments such as the Federal Reserve’s first expansionary move since 2020 and policy tightening from the Bank of Japan, which pushed equity market volatility to its highest level since March 2020.

The second quarter of 2024 yielded mixed market results, with rallies from the first quarter losing momentum. It was a relatively quiet period as markets generally trended steadily. While investor sentiment remains positive, the overall feeling is that the pace has slowed.

The investor letter for Q1 2024 indicates a positive start to the year with a continuation of the strong market performance from Q4 2023, driven by disinflation and economic resilience, particularly in the U.S., which has boosted investor confidence. However, challenges such as inflation uncertainty and high valuations in leading global equities add complexity to investment strategies, despite the overall buoyant market sentiment and solid portfolio gains.

In the final quarter of 2023, investors witnessed strong returns concluding the year on an optimistic note. The year marked a recovery across asset classes in which equities and bonds gradually recuperated throughout 2023 from the substantial drawdowns seen in 2022. The major driving force behind this rebound was a period of immaculate disinflation and economic resilience, particularly from the US economy that increased global mega-cap stocks. Despite Australian equities clocking negative returns to the end of October, they remarkably reversed their fortunes in Q4, ending the year on a positive note. Lastly, bonds showcased a positive performance in the last quarter of 2023, thereby preventing a three-year streak of losses for this asset class.

The third quarter of 2023 saw a breakdown in the years' trend as market momentum was challenged. Global mega caps have provided a strong tailwind for performance year to date, masking many of the challenges seen across other asset classes and subsets of the equity market. This trend continued throughout July & August as positive sentiment lifted equity markets higher until a rally in bond yields saw steam come out of markets toward the quarter’s final weeks.

The second quarter of 2023 brought continued performance for investment portfolios as international equities continued to build on their momentum from the first three months of 2023.

The first quarter of 2023 continued on the previous quarter’s momentum as markets climbed to start the year. Early in the quarter, the market gained confidence in central banks executing on a soft-landing scenario however this sentiment deteriorated as a series of hotter-than-expected inflation prints and systematic issues in the banking sector hit the headlines. International equities generated strong returns for the quarter outperforming Australian equities. Currency markets remained volatile as the US dollar appreciated approximately 1.5% against the AUD.

The fourth quarter of 2022 brought some much-needed relief for investors as markets climbed after a challenging previous three quarters. We saw a strong rebound from October, with markets rallying as much as 10% to late November, before retreating throughout December. Australian equities generated strong returns for the quarter outperforming international equities. Currency markets remained volatile as the Australian dollar appreciated around 3% against the USD.

The third quarter was very much a tale of two halves for investment markets. We saw a strong rebound in July from June’s lows, with markets rallying as much as 10% to late August, before erasing almost all the gains in the remainder of the quarter. Australian equities were marginally positive during the quarter, whilst international equities were marginally positive in AUD, however posted significant declines in local currency terms.

Investment markets continued their decline throughout the second quarter of 2022, as both domestic and global markets trended lower. For investors, the largest challenge has been stomaching the rapid pivot in monetary policy globally and digesting inflation data which has proven to be more persistent than initially thought.