How I generated a 66.6% return in my SIPP in 2025 (and my strategy for 2026!)

I’ve been running my Self-Invested Personal Pension (SIPP) for six years now. Over that time, I’ve ridden out Covid-era losses, enjoyed a sharp rebound in 2022 as my energy stocks surged, and learned a lot about volatility along the way.

But 2025 has been my strongest year by a wide margin, with several long-term conviction holdings finally delivering in a big way. Here’s how I generated a 66.6% return – and how I’m positioning my SIPP for 2026.

Top performers

The table below shows my best-performing SIPP holdings so far in 2025. They’re a mix of blue-chip dividend payers and higher-risk growth stocks – exactly the balance I aim for in my long-term pension.

Valuation matters

The common thread here is simple: each of these shares was either deeply undervalued or entering a clear earnings recovery when I bought them – exactly what I look for in my SIPP.

Fresnillo is the standout, putting the FTSE 100’s 18% gain firmly in the shade. When I bought my first tranche in 2022, the precious metals sector was still stuck in a decade-long bear market.

But with inflation surging and Covid-era stimulus flooding the system, I believed gold and silver would return to favour – and that shift has now played out.

China ‘uninvestable’?

I doubled down on Asian insurance giant Prudential at the start of the year because of a dominant Wall Street narrative: China had become ‘uninvestable’.

At the time, the share price was trading below its Covid sell-off lows. Since then, the Chinese government has unleashed fresh stimulus to revive an economy hit by a bursting property bubble.

Low energy prices have amplified that effort, helping fund infrastructure build-outs across China and wider South-East Asia – regions where Prudential generates a significant chunk of its revenues.

My strategy for 2026

What’s become clear to me is that China – and much of Asia – is leapfrogging Western industries. It benefits from cheaper capital, labour, and energy, while governments are actively encouraging long-term investing and stock ownership.

I struggle to imagine a stronger backdrop for Prudential’s long-term growth. As Asia’s middle class expands, demand for services we take for granted in the West is rising fast.

Insurance penetration remains in the low single digits, and the protection gap across Asia is estimated at $119trn. For me, that underpins why the opportunity still looks compelling heading into 2026.

That said, there are risks worth keeping in mind. Regulatory policy in China can change quickly, currency movements may affect reported returns, and economic growth across Asia won’t be linear. While none of these factors alter my long-term view, they could introduce periods of volatility along the way.

Bottom line

For me, a SIPP is about thinking long term and using volatility to my advantage. When share prices fall, dividend yields rise, allowing me to lock in higher income for the future. That approach has worked well in 2025 and shapes how I’m positioning my portfolio for 2026. By focusing on valuation, cash generation, and durable businesses, I’m aiming to compound both income and capital over time.

The post How I generated a 66.6% return in my SIPP in 2025 (and my strategy for 2026!) appeared first on The Motley Fool UK.

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Andrew Mackie has positions in Fresnillo Plc, HSBC, Aberdeen, Prudential and Aviva. The Motley Fool UK has recommended Fresnillo Plc and Prudential Plc. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

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