Happy New Year! The calendar flips and I would like to wish everyone a healthy, calm, and prosperous 2026 ideally with fewer surprises but just enough volatility to keep markets interesting.
Well, 2025 defied no shortage of bearish forecasts. It was supposed to be the year of the crash due to President Trump, and instead, it turned out to be totally different from forecasts. When tariff announcements hit the wires, prices plunged, volatility spiked, and the word “recession” was suddenly everywhere again, dusted off and paraded around as if it had never left the newsroom.
The year reinforced a familiar lesson that the market rarely rewards investors for believing they are smarter than everyone else or smarter than the market. It favors discipline, method, and emotional distance. By contrast, 2025 was far less kind to those who chased commentary from journalists or analysts and changed their views as frequently as prices moved.
In practice, markets also performed their own form of risk profiling. 2025 was a busy year for some of my partners. I had to adjust certain portfolios for their clients who discovered that their tolerance for market stress was lower than expected. There is no judgement in that. Market cycles are remarkably effective at revealing risk tolerance faster than any questionnaire.
Against this backdrop, all of my portfolios ended 2025 with better than expected gains. Not because they predicted every move correctly but because they are built to adapt to market conditions without emotion or the need for constant intervention.
Overnight some people I know suddenly develop a remarkable new skill to forecast the next 12 months with absolute certainty. The bad news is uncertainty is unlikely to fade. Volatility could exceed what we saw in 2025.
In this environment, discipline, adaptability, and a clear process matter far more than prediction. Markets will continue to test patience but they also tend to reward those who stay focused on method rather than noise.