The key points are:
While recession fears, worries about US tariffs and war with Iran resulted in volatility, 2024-25 saw another financial year of strong returns helped by central bank rate cuts, economic conditions proving better than feared, and as President Trump paused the worst of his tariffs and Iran fears fizzled.
Share market volatility is likely to remain high given tariff uncertainties, concerns about US debt, geopolitical threats and likely weaker growth and profits. But with Trump likely to pivot towards more market friendly policies and central banks, including the Fed and RBA, likely to cut rates further, investment returns should be reasonable over 2025-26.
However, after three years in a row of 9-10% balanced growth super fund returns, some slowing is likely to a more sustainable pace around 6-7% particularly as share valuations are high.
The key for investors including super fund members is to maintain a long-term strategy and turn down the noise.