General Investing Powered by BlackRock® – November 2025 Reoptimisation

Market Overview and Impact

October carried forward September’s positive momentum, with global equity markets extending gains as sentiment strengthened. Investor confidence was bolstered by resilient corporate earnings and rising expectations of additional central bank easing amid signs of labor market softening. Against this backdrop, the Federal Reserve (Fed) delivered another 25-basis-point rate cut in late October, providing a tailwind for risk assets.

While concerns over renewed US–China trade tensions initially weighed on sentiment, markets rebounded later in the month following a meeting between the two countries’ leaders. To highlight, Japanese equities rallied in October after the election of Prime Minister Takaichi, which sparked optimism about potential fiscal stimulus and corporate governance reforms, while US equities also advanced on the back of robust Q3 earnings and expectations of a rate-cutting cycle.

Fixed income markets generally delivered modest gains in October. US Treasury yields declined early in the month as expectations for continued Fed easing gained traction, but slightly reversed course toward month-end after the Fed adopted a more cautious outlook for further cuts. Riskier parts of the fixed income market, namely corporate credit and emerging market debt, rose across the period. Meanwhile, gold gained, benefiting from falling interest rates, geopolitical developments, and ongoing central bank demand.

Source: BlackRock, as of 14 November 2025.

Conservative, Balanced and Aggressive Portfolios

Performance Commentary

In October, the core models delivered positive performance and outperformed their respective benchmarks. Overall, models with higher allocations to equities posted stronger returns.

BlackRock’s broad equity allocations were the primary contributors to the models’ performance over the month. Notably, maintaining a modest overweight in US equities added value on both an absolute and relative basis, supported by strong Q3 earnings, continued optimism around artificial intelligence, and rising expectations of a Fed rate cut. Outside the US, allocations to emerging markets also contributed positively. Japanese equities were also additive, driven by the election of Prime Minister Takaichi, which boosted expectations for potential fiscal stimulus and corporate governance reforms.

The majority of BlackRock’s fixed income exposures also contributed positively. Allocations to long-to-medium term bonds were the key contributors, while emerging market bonds and mortgage-backed securities were also additive.

Gold, a portfolio diversifier, continued to add value to BlackRock’s models, benefiting from falling interest rates and evolving geopolitical developments.

Source: BlackRock, Morningstar as of 31 October 2025. Performance is based on USD total returns with income reinvested and net of total expense ratios but gross of transaction costs. Past performance does not guarantee future results.

* Inception date for Conservative, Balanced and Aggressive portfolios is 31 December 2014.

** Using Bloomberg Global AGG/world equity index until 31 December 2017, Bloomberg US Universal/world equity index EUR/GBP hedged to USD after 31 December 2017.

Reoptimisation Commentary

Key takeaways

• Further increasing equity overweight from 2.0% to 2.5%, supported by resilient economic data, a more supportive policy backdrop, and the preliminary trade deal between the US and China.
• Taking a more constructive view of US and emerging markets equities, which demonstrate solid fundamentals.
• Slightly trimming duration as evolving policy expectations could keep interest rates volatile.
• Maintaining gold exposure as a portfolio diversifier in light of persistent geopolitical risk and policy uncertainties.

The US Federal Reserve (Fed) cut rates twice in September and October, lowering them by 25 basis points each amid signs of a softer labour market, creating room for more accommodative policy measures. Although Fed Chair Jerome Powell cautioned that another cut in December is not a “foregone conclusion”, BlackRock believes that resilient economic data, a more supportive policy backdrop, and the preliminary trade deal between the US and China, which has helped stabilise sentiment, present an opportune time to increase their equity overweight from 2% to 2.5%. Looking ahead, they expect that future progress on trade will hinge more on political alignment than on economic considerations, as underlying fundamentals remain resilient.

Within equities, BlackRock is taking a more constructive view on US and emerging markets equities. They are further increasing their allocation to US equities as GDP growth remains solid and corporate earnings continue to show strength, supported by the tailwind of an ongoing monetary easing cycle. In addition, the rapid progress in artificial intelligence is giving US companies, particularly in technology and related sectors, a competitive edge, fuelling long-term growth and driving innovation that is expected to ripple across the broader economy. 

Meanwhile, emerging markets (excluding China) also present compelling opportunities, supported by solid earnings prospects and attractive valuations. Relatively speaking, they are taking a wait-and-see approach on China, where geopolitical developments could create some uncertainties. Elsewhere, they maintain allocation to Japanese equities following the profit-taking in the previous rebalance, with potential fiscal stimulus under the new administration that could provide medium-term support.

On the fixed income side, BlackRock is slightly trimming duration by reducing exposure to long-term US Treasuries to balance the market’s optimism around rate cuts, as sticky inflation and still-resilient activity are likely to disappoint market expectations. On the riskier end of the spectrum, they are adding to emerging market hard-currency exposures, as most emerging market central banks have already begun or are expected to maintain easing cycles, which support attractive carry opportunities for the asset class.

BlackRock is maintaining a basket of diversifiers to achieve returns beyond traditional stocks and bonds. In particular, they continue to hold gold as a diversifier, which has performed strongly year-to-date amid heightened geopolitical uncertainties. They also keep exposure to inflation-linked bonds as inflation still remains sticky.

Very Aggressive Portfolio

Performance Commentary

The equity model delivered positive returns and outperformed its benchmark in October.

Maintaining a modest overweight in US equities added value on both an absolute and relative basis, supported by strong Q3 earnings, continued optimism around artificial intelligence, and rising expectations of a Fed rate cut. Elsewhere in the models, allocations to emerging markets also contributed positively. Japanese equities were also additive, driven by the election of Prime Minister Takaichi, which boosted expectations for potential fiscal stimulus and corporate governance reforms.

Source: BlackRock, Morningstar as of 31 October 2025. Performance is based on USD total returns with income reinvested and net of total expense ratios but gross of transaction costs. Past performance does not guarantee future results.

* Inception date for Very Aggressive portfolio is 31 Oct 2016.

** Using Bloomberg Global AGG/world equity index until 31 Dec 2017, Bloomberg US Universal/world equity index EUR/GBP hedged to USD after 31 Dec 2017.

Reoptimisation Commentary

The US Federal Reserve (Fed) cut rates twice in September and October, lowering them by 25 basis points each amid signs of a softer labour market, creating room for more accommodative policy measures. Although Fed Chair Jerome Powell cautioned that another cut in December is not a ‘foregone conclusion’, BlackRock believes that resilient economic data, a more supportive policy backdrop, and the preliminary trade deal between the US and China, which has helped stabilise sentiment, provide an accommodative environment for risk assets.

BlackRock is taking a more constructive view on US and emerging markets equities. They are further increasing their allocation to US equities as GDP growth remains solid and corporate earnings continue to show strength, supported by the tailwind of an ongoing monetary easing cycle. They are taking partial profits from their US information technology exposures, while maintaining a medium-term conviction amid the rapid progress in the development of artificial intelligence.

Meanwhile, emerging markets (excluding China) also present compelling opportunities, supported by solid earnings prospects and attractive valuations. Relatively speaking, BlackRock is taking a wait-and-see approach on China, where geopolitical developments could create some uncertainties. Elsewhere, they are increasing allocation to Japanese equities following the profit-taking in the previous rebalance, with potential fiscal stimulus under the new administration that could provide medium-term support.

Source: BlackRock, performance commentary as of 31 October 2025. Rebalance date is 21 November 2025.

This information should not be relied upon as investment advice, research, or a recommendation by BlackRock regarding (i) the iShares Funds, (ii) the use or suitability of the model portfolios or (iii) any security in particular. Only an investor and their financial advisor know enough about their circumstances to make an investment decision. Past performance is not a reliable indicator of future results and should not be the sole factor of consideration when selecting a product or strategy.

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