Long-Term Global Market Index (GMI) Return Forecast Stabilizes at 7.2% (December 2025)

On December 2, 2025, James Picerno published a long-term return forecast for the Global Market Index (GMI) at 7.2% annualized, based on November 2025 data [1]. This forecast marks a slight increase from the previous month but remains consistent in the 7%-plus range. Notably, it is 200 basis points below the GMI’s trailing 10-year return of 9.2%, indicating tempered long-term return expectations for a broad global asset portfolio. The forecast methodology incorporates historical returns, equilibrium risk-based estimates, and adjustments for momentum and mean reversion [2].
Three major asset classes are projected to underperform their respective trailing 10-year results: US equities (tracking ETF VTI, with a recent daily gain of 0.19% at $335.30 [0]), commodities (tracking ETF GSG, with a 0.02% daily decline at $23.28 [0]), and US high-yield bonds (tracking ETF JNK, with a 0.06% daily gain at $97.02 [0]). Short-term market impact is expected to be minimal, as immediate dynamics are driven by economic data, earnings, and central bank policies [0]. However, medium-to-long-term effects may include adjusted investor return expectations and potential asset allocation shifts toward components projected to outperform historical returns [0].

1. Sustainable Return Realignment
   : The forecast suggests the strong returns of the past decade are unlikely to persist, requiring investors to reset long-term expectations. This realignment may foster a more cautious long-term market sentiment [0].
2. Targeted Asset Class Scrutiny
   : US equities, commodities, and high-yield bonds face projected underperformance despite mixed recent daily results, highlighting potential headwinds that may emerge over extended horizons [0].
3. Diversification Importance
   : The majority of GMI components are expected to outperform their trailing 10-year returns, emphasizing diversification as a strategy to navigate potential underperformance in specific asset classes [0].

• Forecast Uncertainty
  : Long-term return projections are inherently uncertain and subject to changes in economic conditions, inflation, and geopolitical events [0].
• Underperformance Exposure
  : Investors with concentrated positions in US equities, commodities, or high-yield bonds may face lower-than-historical returns over the long term [0].
• Model Limitations
  : The forecast relies on historical data and assumptions that may not hold in future market environments [0].

• Asset Allocation Adjustments
  : Investors may explore reallocating to GMI components projected to outperform historical returns, though such decisions should be aligned with individual risk tolerance and investment horizons [0].

The December 2025 GMI forecast indicates a long-term annualized total return of 7.2%, below the trailing 10-year 9.2%. US equities, commodities, and high-yield bonds are the primary underperformers. While short-term market impact is minimal, the forecast may influence medium-to-long-term asset allocation strategies. Decision-makers should consider their investment horizons and risk tolerance, noting data gaps such as the exact GMI composition and historical forecast accuracy [0].

Cited sources: [0] Ginlix Analytical Database; [1] Seeking Alpha - Total Return Forecasts: Major Asset Classes - December 2, 2025; [2] Ginlix Analytical Database