How the portfolios performed over the June 2025 quarter
Global markets rebounded strongly over the June 2025 quarter, shaking off early April volatility sparked by renewed US trade tariffs. Sentiment improved as the quarter progressed, helped by a delay in tariff implementation and a softer US dollar, both of which boosted investor appetite for risk. Confidence lifted further towards the end of the quarter, as geopolitical tensions in Ukraine, Israel, and Iran showed signs of easing.
In Australia, share markets surged to record highs. After a cautious start, momentum picked up in May and June amid growing expectations of interest rate cuts. Gains were led by growth sectors and major banks, though earnings growth didn’t always keep pace with rising prices — raising some concerns about high valuations. Globally, international shares also rallied, led by the US. Optimism around stronger earnings and hopes for a “soft landing” — easing inflation without triggering a recession — supported risk assets, especially in cyclical sectors. However, US share valuations remain elevated relative to long-term averages. Bond markets also fared well, with falling Australian bond yields and resilient credit markets driving solid returns across fixed interest strategies.
All Partners Portfolios posted positive returns for the quarter, with the Medium Term, Long Term and Multi-Asset Income Portfolios performing particularly well, supported by the strength in global share markets.
Key Contributors
Vinva Global Alpha Extension added strong value to the Partners Medium Term and Long Term Portfolios over the June quarter. The strategy looks for opportunities across a wide range of global shares, using large volumes of data and carefully designed signals to guide its investment decisions. All of Vinva’s key signals performed well during the period. One in particular — the Business Linkages signal — was especially effective. It estimates how well a company is likely to trade by analysing related businesses, such as suppliers, customers, and competitors. This helped the portfolio tap into strong performance in areas like technology and industrials, and benefit from the broader global market rally.
ClearBridge RARE Infrastructure Income — used across the Partners Multi-Asset Income, Medium Term, and Long Term Portfolios — was a standout, generating strong results and contributing positively to overall returns. With a focus on essential infrastructure assets such as utilities and transport, this strategy benefited from its income-generating stability and low correlation with broader market swings, helping anchor portfolio outcomes in a volatile environment.
Key Detractors
Evidentia Quality Core delivered strong absolute returns over the June quarter but lagged a sharply rising market, making it a relative drag on the Partners Multi-Asset Income, Medium Term, and Long Term Portfolios. The primary driver of underperformance was an underweight position in the banking sector, which rallied strongly despite ongoing concerns about margin pressure and subdued credit growth. The manager remains cautious on bank valuations — particularly Commonwealth Bank, which rose more than 22% during the quarter on limited earnings upgrades and now trades at a record-high valuation. With pricing well above historical norms and sector peers, the position has been trimmed as the risk-reward trade-off appears increasingly stretched.
GQG Global Equity was a detractor from performance in both the Partners Medium Term and Long Term Portfolios, underperforming its benchmark. While the strategy benefited from strong returns in select communication services companies, this was outweighed by weaker stock picking in the US and financial sectors, an underweight position in the booming technology sector, and losses in energy names. The result highlights how some of the fund’s defensive positioning and stock choices didn’t align with the broader rally in global equities.
Looking Ahead
Despite ongoing geopolitical tensions in Ukraine, Israel, and Iran, global markets have remained steady, with limited disruption to investor sentiment. However, signs of a global economic slowdown are emerging, particularly in the US. That said, strong labour markets continue to support household demand, helping to cushion against more severe downturn risks.
Share markets have rallied, but we see growing risks. Valuations are elevated, especially in the US, while Australian shares have risen more on sentiment than fundamentals, with dividend yields now sitting below bond yields — an unusual situation. At the same time, US government bond markets have stabilised, and investor demand for credit has improved. While the recent passage of large-scale US fiscal stimulus (tax cuts and increased government spending) hasn’t unsettled bond markets as feared, trade risks remain high. Given this backdrop, we continue to take a cautious, diversified approach with a tilt towards quality assets.
Ironbark Advice is the sponsor of the Partners Portfolios. Ironbark Advice is comprised of the following wholly owned entities of Ironbark: Advice First Pty Ltd, Advisory Group Pty Ltd, ARTT Group Pty Ltd, Brisbane Financial Services Pty Ltd, Elevate Financial Solutions Pty Ltd, Emohruo Financial Services Pty Ltd, Invest Blue Armidale Pty Ltd, Invest Blue Brisbane Pty Ltd, Invest Blue Coffs Harbour Pty Ltd, Invest Blue Direct Pty Ltd, Invest Blue Gladstone Pty Ltd, Ogilvie Financial Services Pty Ltd, TDT (Tas) Pty Ltd, The Bravien Group Pty Ltd, Vintage Wealth Pty Ltd and Wainscott Financial Planning & Advice Pty Ltd, trading as Ironbark Advice are authorised representatives and credit representatives of Akumin Financial Planning Pty Limited, Australian Financial Services Licence and Australian Credit Licence No. 232706. Countrywide Advice Pty Ltd and GrowUp Financial Pty Ltd trading as Ironbark Advice are authorised representatives and credit representatives of Charter Financial Planning Limited, Australian Financial Services Licence and Australian Credit Licence No. 234665. GR & LC Thompson Pty Ltd trading as Ironbark Advice, is an authorised representative and credit representative of Hillross Financial Services Limited, Australian Financial Services Licence and Australian Credit Licence No. 232705. LFC Advice Pty Ltd (ABN 19 647 509 466) trading as Ironbark Advice, is a Corporate Authorised Representative of LFC Group Pty Ltd (ABN 35 644 576 965), AFSL 526600.