How did the AJ Bell funds perform in the third quarter of 2025?
Archived article: Please note that tax, investment, pension and ISA rules can change and the information and any views contained in this article may now be inaccurate.
After a start to the year dominated by significant geopolitical turbulence, the third quarter was more stable.
We caught up with the Head of Investment Solutions at AJ Bell, James Flintoft, to discuss the key events which impacted financial markets during the period, how AJ Bell funds performed, and what the outlook is looking like as attention turns towards 2026.
How did markets perform in the third quarter of 2025?
We saw some easing of tensions around trade wars during the quarter. That’s allowed other themes to emerge, such as concerns around the US economy and the rise of AI in China.
Generally, equity markets have been very positive, with the noise being lowered over the quarter. There was a bit of weakness on a relative basis in Europe, but the UK has done well on a broad basis, with notable success from financials and miners.
How did bond markets perform in Q3, 2025?
Bond markets saw some big movements. We had the first interest rate cut of the year from the US in response to some of the weakness in economic data and we’ve had a cut in the UK as well. Here, longer-dated bonds have been a bit volatile and that is an area we’ve been looking to protect against in portfolios.
How did AJ Bell funds perform in the quarter?
Returns have been good, led by equity markets. We’ve benefited from higher risk positions. Our income portfolios have seen a little bit of relative weakness though.
What's on your mind as we approach 2026?
We've had a relatively calm period in markets with a risk-on attitude. It feels like there's plenty of headlines to come between now and the end of the year. Whether or not they'll matter for markets will be another thing.
If we think about our portfolios and how we've positioned them, the big theme has been around inflation and making sure that we're protected and that we're not taking too much risk in bond markets. The market has started to come around to our way of thinking with yields rising, particularly on longer-dated bonds.
Inflation continues to be a theme in the UK, with the inflation figure expected to be double the Bank of England’s target in the fourth quarter.
How have the AJ Bell funds performed over the longer-term?
The table below shows the 5-year performance of each of the AJ Bell funds.
| AJ Bell fund | 5-year return (%) |
|---|---|
| AJ Bell Cautious | 15.07 |
| AJ Bell Moderately Cautious | 26.32 |
| AJ Bell Balanced | 40.36 |
| AJ Bell Moderately Adventurous | 53.00 |
| AJ Bell Adventurous | 68.98 |
| AJ Bell Global Growth | 67.91 |
| AJ Bell Income | 34.64 |
| AJ Bell Income & Growth | 60.96 |
| Returns are cumulative net return | |
The AJ Bell Responsible Screened Growth Fund was launched on 20 November 2020 and therefore does not have 5-year performance history.