Strategists are divided as to what’s in store in 2023, but there’s increased optimism the next decade is looking better for investors.

A year ago, fund giant Vanguard warned that US stocks were more overvalued than at any time since the dotcom bubble and that global stocks would likely deliver the worst 10-year returns since the early 2000s.

2022′s heavy falls have changed all that. Although still above fair value, US stocks are expected to return 4.7 to 6.7 per cent annually over the next decade, a 2.4-point increase over last year’s projections. A similar jump in long-term returns is expected for non-US markets.

Meanwhile, although bond markets have endured a torrid 2022, the unexpected spike in yields mean global bonds are now priced to return 4-5 per cent annually over the next decade. In other words, says Vanguard, long-term investors will likely be better off “because, not in spite, of the sell-off”.