While it would seem many investors would have reason to celebrate, those gains accrued only to a small portion of the market. Bonds saw muted returns as interest rates on the longer end of the curve actually rose. International equities and emerging markets failed to keep up as a stronger U.S. dollar offset price gains, leaving U.S. based investors with mid-single-digit total returns. Even within the S&P 500 the “Magnificent 7” delivered an average return in excess of 57%, while the remaining 493 stocks returned an average just under 15%. Private equity strategies, which have provided premiums to public market (as measured by the Burgiss Private Equity benchmark vs the S&P 500 over the trailing 10-year period as of 9/30/2024 ), lagged as M&A and IPOs volumes have yet to return to previous levels. Investors who exercised any level of prudent diversification may be wondering when the rest of the market will respond in kind.
Looking ahead to 2025, investor attention remains on the Federal Reserve and their path to a neutral rate environment, but increasingly fiscal and governmental policy has come into focus. A change in presidential administration with dramatic policy proposals around immigration, spending, and foreign policy looms large. In this annual outlook note, we set the stage for our view of the macroeconomic backdrop, the potential impacts of policy proposals, and highlight a number of key themes that we believe will drive markets and investor returns in 2025 and beyond. See these articles to explore:
2025 Economic and Market Outlook
2025 Outlook: Policy Implications Into 2026
Key Investment Themes & Opportunities for 2025
[1] The “Magnificent 7” includes Microsoft, Apple, Amazon, Meta, Tesla, Google and Nvidia. Forward PE: Factset.
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This communication and its content are for informational and educational purposes only and should not be used as the basis for any investment decision. The information contained herein is based on publicly available sources believed to be reliable but is not a representation, expressed or implied, as to its accuracy, completeness or correctness. No information available through this communication is intended or should be construed as any advice, recommendation or endorsement from us as to any legal, tax, investment or other matters, nor shall be considered a solicitation or offer to buy or sell any security, future, option or other financial instrument or to offer or provide any investment advice or service to any person in any jurisdiction. Nothing contained in this communication constitutes investment advice or offers any opinion with respect to the suitability of any security, and this communication has no regard to the specific investment objectives, financial situation and particular needs of any specific recipient. Past performance is no guarantee of future results.
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