Your 2025 market predictions are in: Insights from nearly 5,000 investors

2024 was a remarkable year for capital markets. From Australian equities to government bonds and gold, nearly every major and emerging asset class delivered positive returns.

A High Bar for 2025

Trump’s leadership is already causing geopolitical ripples. His threats of 25% tariffs on all goods from Mexico and Canada - the latter of which he has provocatively labeled the US's "51st state" - along with aspirations to annex Greenland and Panama, have sparked global unease, even before his inauguration as the 47th President.

Aren't we glad as Australians to be so far away from the action?

With geopolitical tensions rising and following an extraordinary year for markets, we sought the insights of Livewire and Market Index readers on the opportunities, challenges, and risks they foresee in 2025. As part of our annual Outlook Series survey, 4,814 respondents shared their perspectives - here’s a summary of what you had to say.

1. How will Donald Trump's re-election as U.S. President impact your 2025 investment strategy?

Despite expectations that Trump will upend the current world order and his threats to wield "economic force" against key trade partners - moves that could cause global economic havoc - most of you aren’t planning significant changes to their portfolios.

• 54.5%: “I don’t plan to change my asset allocation.”
• 32.5%: “Boost exposure to growth assets.”
• 13%: “Boost exposure to defensive assets.”

Many investors recognise that time in the market, not timing the market, is the key to long-term success. Historical data shows that staying invested - regardless of political shifts - yields better outcomes over time.

2. which asset class will deliver the best returns in 2025?

When it comes to 2025’s top-performing sectors, our readers were clear:

• Technology is expected to lead again. Despite lofty valuations, investors are positive on many of the sub-themes including AI, cybersecurity and automation.
• Commodities and energy, beaten down in 2024, could stage a comeback.
• Cryptocurrency surprised us with how strongly it ranked, but it makes sense given the price hit US$100,000 following the US election.

Investment Theme

“On its way to become digital gold”: What’s next for Bitcoin, and how to play it

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3. Will tech continue to outperform value stocks in 2025?

Opinions are divided, but 40% of respondents believe tech stocks will "go to the moon," while 24.2% expect a rotation to value.

Interestingly, when asked to nominate their top ETFs for 2025, our audience started leaning towards a more diversified approach in global markets to capture a potential rotation. You can explore the most-tipped ETFs below.

Funds

Your 10 most-tipped ETFs for 2025

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4. THE ASX 200: Where Will It End in 2025?

After double-digit gains in 2024, most readers are optimistic about the ASX 200 this year:

• 51.2% expect the index to land between 8,500–9,000.
• 16.8% predict it could hit 9,000–9,500.
• Meanwhile, 20% believe it will hover between 8,000–8,500.

This reflects an expected upside of 4.17% to 16.43% from the 31 December 2024 close of 8,159.

4. If you had to take one contrarian bet for 2025, what would it be?

When asked about contrarian plays, nearly 25% of respondents said they would short Australian banks after their stunning total return in 2024 (around 35%.) Conversely, almost one in five plan to go long on commodities, and in particular, lithium. These were two sectors that faced headwinds last year.

Carl Capolingua published some excellent year-end pieces and series outlining the outlook for banks and key metals, which you can explore below. 

Equities

7 Magnificent Miners: The outlook for copper, iron ore, lithium, coal, gold, nickel and uranium

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Equities

ANZ, Commonwealth Bank, NAB and Westpac have had a monster 2024. Can it continue?

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6. With ASX bank stocks up over 30% this year (including dividends), what’s your plan for sector exposure?

Following the sizzling rally among banks in 2024, it was revealing to note that:

• 57% of respondents do not plan to increase their exposure to banks.
• 37.5% intend to reduce their holdings.
• Just 5.5% are bold enough to buy more bank shares.

Banks remain a divisive topic, particularly given CBA's valuation (which Schroders pointed out is more expensive than Alphabet/Google). That’s why, in the coming weeks, we’ll explore where value can be found outside the Big Four for investors seeking income and financials exposure outside the major and regional lenders.

7. How much of your portfolio is currently sitting in cash & term deposits?

Investors are split when it comes to liquidity:

• 39.2% are holding 0–10% of their portfolios in cash.
• 23.7% have allocated 11–20%.
• 14.5% are sitting on 21–30%.

The remainder are more heavily weighted in cash, possibly waiting for better opportunities or bracing for volatility.

8. If the RBA cuts rates in 2025, would you be buying any of the following?

If the RBA cuts rates in 2025, many investors plan to redeploy cash into growth stocks and dividend equities, while others prefer to ride out lower returns. This approach aligns with the need for growth and above-cash returns to outpace inflation. However, it will be interesting to see how valuations shape up when the RBA finally joins the rate-cutting cycle. My colleague Hans Lee will be delving deeper into this insight in a future piece.

9. What is the single biggest concern for your investment strategy in 2025?

Unsurprisingly, market corrections and geopolitical tensions topped the list of concerns, followed closely by challenges in finding attractive growth opportunities in our commodity- and financial-heavy markets. 

Make sure to follow the Livewire team as we will be publishing content and screening criteria to help you identify ASX companies with strong growth potential and go deeper into other key themes mentioned in this wire.

In the meantime, don’t miss the 10 top growth ideas for 2025 from fund managers who participated in our Outlook Series.

Equities

The #1 growth stocks set to explode in 2025

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10. Where are you sitting on the cycle of investor emotions?

Finally, we asked where you were sitting on the cycle of investor emotions.

The good news is that while optimism remains high, it's not as high as last year.

• 40.6% feel optimistic (down from ~50% in 2024).
• 30.2% feel anxious (double last year’s levels).

Chris will be exploring this topic in further detail, and compare where investors are at emotionally with the market cycle itself in coming weeks.

BONUS - Who Do You MOST WANT TO SEE ON LIVEWIRE IN 2025?

As a bonus, we asked who you’d like us to interview, and the top 10 responses included:

1. Warren Buffett (CEO of Berkshire Hathaway)
2. Elon Musk (the world's richest man)
3. Donald Trump (incoming US president)
4. Marcus Padley (Founder of Marcus Today)
5. Chris Ellison (Founder of Mineral Resources)
6. Geoff Wilson AO (Founder of Wilson Asset Management)
7. Andrew Forrest (Founder and Former CEO of Fortescue)
8. Matt Comyn (CEO of CBA)
9. Roger Montgomery (Founder of Montgomery Investment Management) 
10. Shemara Wikramanayake (CEO of Macquarie Group)

You’ve set lofty expectations, and we’ll do our best to deliver these high-profile guests!

We'd like to thank everyone who participated in the 2025 Outlook Survey. Stay tuned for more content from the series in the weeks ahead, and good luck with your portfolio this year!