IDAD Perfomance – Q3 2025
We saw 144 new products during the quarter – definitely a record – and 120 maturities. Annualised returns across all products are now over 10% per annum, which is fantastic and in line with the strong stock market performance we’ve had over the last couple of years. In part, this reflects the change in IDAD’s product mix as we’ve been delivering higher return products for investors looking for excess growth in parts of their portfolios. It’s important to remember though, that with a wider range of product payoffs and risk profiles, the investments that offer the potential for the highest returns aren’t always the ‘best’ choice for all clients. Structured products work because they deliver a significantly higher probability of achieving a desired outcome – if you want 8% per annum growth, you’re most likely to get it with a structured product (but you won’t get 9% a year or 7% a year). If you want 100% capital protection, a structured product gives you a great opportunity to achieve higher returns than a fixed rate deposit. Right now, with many commentators predicting a lot more uncertainty in the global economy, it feels like a good time to be taking some risk off the table and ‘banking’ some of the gains made.
Stock market performance for the quarter was very strong, Hong Kong/China and Japan markets up over 10%, S&P 500 posted almost 8% and even the FTSE 100 was up almost 7% with the Eurostoxx 50 growing by 4%. If it looks like a bull market and smells like a bull market, it probably is a bull market! The ‘AI trade’ still seems to be in the driving seat, with the semi-conductors being the ‘gold’ and the associated infrastructure (server farms and the associated water and power supplies etc.) being the picks and shovels – and a lot of the activity is based in California with a lot of the hard work being done by East Asians – maybe it’s 1849 all over again. I think we’ll see a continuance of the bull run until at least the end of the year and likely well into 2026, but markets will become increasingly volatile and there may be some shocks on the way. With downward pressure on interest rates and more volatility, capital protected products offering equity participation will be pricing less favourably, but the capital at risk products (e.g. traditional autocall/kick out products) will maintain the high rates we’ve become used to.
When it comes to stellar performance though, the Future Wealth Fund delivered 17.6% over the quarter – if you want exposure to the themes of the future, look no further. Refined Growth 8.5% over the 3 months. These are two of the best performing funds out there and widely available across platforms, ask your sales coverage about them.
Clive Moore, Managing Director