INVESTMENTS

Quarterly commentaries

Hear from our investment professionals about recent market activity in equities, fixed income and model portfolios.

Equities

Investors should consider maintaining a balanced allocation with geographic diversity, exposure to dividend payers and an approach to growth that isn't overly concentrated.

As of September 30, 2025

Key takeaways for the quarter

  • Global markets continued their rally in the third quarter of 2025, led by large-cap tech, despite uncertainty in trade, several geopolitical conflicts and signs of slowing in the U.S. economy.
  • International equities continued gains from the first half of the year, remaining well ahead of U.S. stocks on a year-to-date basis.
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Fixed income

We believe important portfolio roles for fixed income include income, capital preservation and diversification from equities.

As of September 30, 2025

Key takeaways for the quarter

  • Fixed income markets generally rose in the third quarter as the Federal Open Market Committee resumed its rate cutting cycle. While economic data was broadly in line with or surpassed expectations, cracks began to appear in the labor market and economic uncertainty remained elevated, both of which contributed to the U.S. Federal Reserve’s move. This suggests more of a focus on the labor market than on renewed inflationary pressures. Despite this and amid geopolitical uncertainty, interest rates in the U.S. fell, while credit spreads generally tightened and equities gained. 
  • Over 5- and 10-year periods, the majority of fixed income American Funds (Class F-2) continued to deliver positive absolute returns and positive relative returns compared to their primary benchmarks.
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Model portfolios

Model portfolio asset allocation remains focused on long-term objectives and investment opportunities despite geopolitical and economic risks, and potentially volatile market shifts.

As of September 30, 2025

Key takeaways for the quarter

  • Markets continued to exhibit their robustness in the third quarter, boosted by solid earnings reports and a rate cut from the Federal Reserve.
  • The American Funds Model Portfolios all had strong, positive absolute gross and net results for the quarter, but nearly all of them lagged their custom benchmarks.
FULL ARTICLE

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