What happened with your portfolio in 2025?

It goes without saying this year has been a wild ride.

From the re-election of Donald Trump and “Liberation Day” shaving trillions of dollars off the global market in days, to Nvidia’s market capitalisation surpassing the economies of every country in the world bar the USA & China.

2025 has been BIG.

But headlines don’t build wealth-strategy does.

So, instead of guessing what these massive global shifts mean for your investments, we went straight to the source! And secured a private market briefing with Tom Wickenden, Investment Strategist at BetaShares, to cut through the noise and get the truth about the market’s performance over the past 12 months and into 2026.

In Short:

📉 The “Liberation Day” Dip:
Markets dropped ~9% early in the year due to fears over Trump’s tariffs, but recovered to new highs within a month once the panic settled.

😴 Playing Dead was a Winning Strategy:
Many “active” fund managers panicked and moved to cash during the drop, missing the rebound. By staying invested, Fox & Hare members captured the 14% upside.

❓The “Why” Behind the Growth:
US Tech giants (like Nvidia) drove the majority of the growth. Crucially, this wasn’t just “hype”- their profits actually grew faster than their share prices.

♻️ The Ethical Reality Check:
Ethical funds lagged slightly behind the broad market this year as “dirty” industries (miners & banks) rallied, but the 3-year average return remains strong at ~12%.

🔮 What’s Next for 2026:
As we look ahead, the divergence between US and Australian interest rates will be key, with Cybersecurity emerging as the major structural growth theme to watch.

Watch the video briefing or read the article below!

Your Next Step:
Read on or watch the webinar recording below, and beat the FOMO by getting the facts. If you want to discuss your next move (or non-move!) with pros, you can reach out to your team directly through the personal finance portal.

The “Liberation Day” Rollercoaster 🎢

If you felt a spike of anxiety looking at the markets earlier this year, you weren’t alone. The defining moment of 2025 was undoubtedly “Liberation Day”—the point where uncertainty over President Trump’s proposed tariffs peaked.

The fear was that these new taxes would crash the global economy. Markets reacted instantly, dropping around 9% as investors braced for the worst.

But here is the important part: The worst didn’t happen.

Almost immediately after the drop, the reality of the policies became clearer (and less severe than feared). The markets didn’t just stabilise – they rocketed back up. In fact, within about a month, the global market had recovered all its losses and was climbing toward new highs.

The “Active” Mistake (And Why Fox & Hare Members Won)

This period taught us a massive lesson about the difference between Active and Passive investing.

When the market dropped, many “Active Managers” (professionals who try to beat the market by trading frequently) panicked. They sold their shares and moved to cash to “protect” themselves.

“After Liberation Day, a lot of active managers went, ‘Oh, okay, the economy is headed for recession… We need to sit in cash.’ Says Tom.

But if you were one of the people who parked your money in cash during that time, within a month, you would have missed a 10% pop. In two months, a 20% pop.”

Those who panicked and withdrew eneded up sitting on the sidelines when the market rebounded. They locked in their losses and missed the recovery.

By simply staying the course and remaining invested, your passive portfolio captured that full recovery and the growth that followed.

The “Liberation Day” effect in action: A sharp ~9% drop caused by tariff fears, followed almost immediately by a race to new all-time highs. This is where the “Active Managers” got it wrong. By selling at the bottom of this dip, they locked in losses and missed the rally that followed says Tom.

Are we in a Tech Bubble? 🫧

If you look at what drove your portfolio’s growth this year, the answer is pretty clear: US Technology.

The big players (like Nvidia, Microsoft, and Apple) did the heavy lifting. But with stock prices soaring, the big question everyone is asking is: Are we in a bubble?

Tom thinks ‘no’ and he has the data to back it up.

“At the moment, I don’t think there’s an equity market bubble just based on valuations.” He says

A “bubble” happens when stock prices go up just because of hype, with no real money to support them. But in 2025, something different happened. While the share prices of these tech giants went up, their profits (earnings) actually grew even faster.

Tom highlights Nvidia as the poster child of the situation.

“Year on year, Nvidia has grown its profits by around 60%… and its price growth over the year had only been about 40%.

So it actually grew its profits faster than its price return.”

That means, believe it or not, these companies are arguably better value now than they were before the rally started.

US Tech drove global growth this year, sparking fears of a new bubble. But the data tells a different story: profits actually grew faster than share prices. Tom suggests they may actually be better value now than before the rally started.

Ethical Investors Skipped the Fossil Fuel Party 🐨🍃

In 2025, the broadly diversified Ethical Funds slightly underperformed the standard market index.

Why the gap?

In short, the “dirty” end of the market had a massive rally over the last twelve months. The broader Australian market (ASX 200) is heavily weighted towards Mining (like BHP & Rio Tinto) and the Big 4 Banks, and these giants were the biggest drivers of growth in Australia this year, but they are strictly excluded from our ethical portfolios.

“If you’re taking a dark green approach… you exclude them. Your BHPs and Rio Tintos are obviously big resource and mining companies. And each of the Big 4 Banks are the biggest financiers of fossil fuels in Australia.” Tom shares.

So, ethical investors missed the “sugar hit” of the fossil fuel rally.

“Unfortunately this year, a lot of the growth in the Australian market came from companies that… would not be included in an ethical investor’s portfolio.”

The Long Game is the Strong Game.

While ethical funds missed the rally this year, it’s important to zoom out. Ethical investing is about long-term sustainability and Tom is quick to point out that even with a tougher 2025, the long-term data remains strong.

The ethical portfolio has returned a “pretty solid 12.4% p.a.” over the last three years.

The cost of a clean conscience in 2025. This chart shows how excluding the “dirty” top performers (like BHP and CBA) created a performance gap for those screening ethically this year.

What’s Coming in 2026? 🔮

So, what should you be watching as we head into the new year?

We asked Tom to dust off his crystal ball, and he highlighted two major themes that he believes are about to take centre stage:

The Great Rate Divide
For the last few years, the world has mostly moved in sync. But in 2026, Tom thinks we should expect a split:

🇺🇸 The US is widely expected to cut interest rates to support their economy.

🇦🇺 Australia (The RBA), however, is signalling they might hold or even hike rates slightly to squash sticky inflation.

What does this mean for you?

This divergence creates a tug-of-war with our currency, says Tom “If we see the US rate come down a lot lower than the Australian rate… I’d expect to see the Australian dollar appreciate.”

A stronger Aussie dollar is great for your holiday to Bali, but it can create a slight headwind for your overseas investments (as your US shares are worth a little less when converted back to AUD).

It’s a key trend the team at Betashares will be watching very closely.

The Next Big Theme: Cybersecurity
While AI has been the undisputed champion of 2025, Tom is also predicting significant growth in the industry that keeps it all safe.

“If I had to pick a really strong structural growth thematic that I could put my hat on for the next five or 10 years… It would have to be cybersecurity.” He shares.

“As AI tools become more powerful and scams become more sophisticated, the need to protect digital assets is becoming a non-negotiable for governments, corporations and individuals alike. That looks like a pretty great opportunity to me.”

Missed the live session? No stress. Hit the image to watch the full briefing with Betashares Tom Wickenden & Fox & Hare Community and Marketing Lead, Liam Hartley.

The Bottom Line

If 2025 taught us anything, it’s that panic is expensive.

Remember: The media is in the business of selling headlines, not building wealth. Their goal is to get your attention; our goal is to get you results.

By sticking to your strategy, ignoring the headlines, and trusting the long-term plan, you turned a year of volatility into a year of growth.

We’ll leave the final word to Tom:

“Once again, the tried, true and tested method of sticking to the plan is what really, once again, would have helped to grow wealth this year. Remember, tune out the noise, keep calm and carry on.”

High-achieving, experienced, and always in your corner. Your Fox & Hare advice team are always working to ensure you are in the best possible possible position – please reach out via the PFP with any questions!

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