Diversification Supports Strong With‑Profits Fund Performance in Volatile Markets

In 2025 changing interest rate expectations and geopolitical and trade uncertainty were dominant themes. Despite this, global markets delivered solid gains demonstrating resilience in a challenging environment. Our With-Profits customers have benefitted from investing in a large, multi-asset, globally diversified fund during this period, with our fund managers seeking out opportunities across a wide range of different asset types. A positive return of 11.6% (gross of tax) was achieved before charges and the effects of smoothing.

2025 was a year of positive market performance despite a persistently volatile backdrop. Some key themes were: 

• Changing interest rate expectations, as central banks balanced inflation and growth. 
• Global political tensions, including Middle East and European conflicts and ongoing trade uncertainty following the US ‘liberation day’ tariff announcement in April.
• Strong equity performance in many markets, particularly European and Asian equities. The AI-driven boom continued to propel technology stocks, while bond markets delivered modest, uneven returns with riskier-high yield corporate bonds and emerging market debt generally outperforming safer counterparts.

Our With-Profits Fund invests in a wide range of globally diversified assets so was able to capture positive returns in some places and avoid difficulty in others. The Fund’s performance has added to its already strong longer-term record, relative to its peers.   

We’ll continue to source and invest in assets that build diversification and help meet the objective of securing the highest total return for the Fund (after any tax and investment expenses) while maintaining an acceptable level of risk and protecting our customers. We’ll also continue to consider our Environmental, Social and Governance aims as they apply to the Fund.

The value of any investment can go down as well as up so your customer might not get back the amount they put in. Past performance is not a reliable indicator of future performance.