Feb 1, 2026
On The Continuum - What 2025 could mean for 2026
Introduction
As Frank Sinatra famously sang, "It was a very good year." For investors, 2025 delivered across the board—stocks up, bonds up, gold and silver up. But the smooth annual returns mask the turbulence along the way. From tariff-driven panic in April to AI-fueled euphoria throughout, 2025 tested investor discipline. Here's our look back at what happened, what to expect in 2026, and the timeless lessons that remain.
Q1: What defined the market narrative in 2025?
Two dominant themes shaped the year: tariffs and artificial intelligence. The year opened with President Trump's second term and a clear objective to rebalance global trade dynamics. Markets drifted lower through March in anticipation of "Liberation Day" tariff announcements. When the press conference came on April 2nd, fear was palpable—stocks lost over 12% in the following week. Meanwhile, AI continued its relentless march, driving returns and raising the same questions we've been grappling with: Is this a bubble? Are we in the early innings or the ninth inning of this bull market?
Q2: What lesson did the April tariff selloff teach investors?
The April episode was a masterclass in market behavior. Sudden changes to the global economic outlook cause investors to sell first and adjust expectations later. This knee-jerk reaction underscores a timeless truth: have a plan and stick to it. Those who made emotional, short-term decisions in April may have missed the strong returns the second half of the year delivered. Market timing based on fear rarely works.
Q3: How should I think about AI's role in my portfolio going forward?
The AI narrative presents the opposite emotional challenge. The allure of a transformative technology can create fear of missing out (FOMO) that's just as dangerous as panic selling. We don't know which stage of the AI-related bull market we're in—and neither does anyone else. What matters is being prepared for multiple outcomes. Ask yourself: Am I prepared for this bull market to end tomorrow? Am I prepared for it to end in five years? The answer to both should be yes. That's what a properly diversified, plan-based approach provides.
Q4: What should I expect for 2026?
Rather than making specific predictions (which are almost always wrong), we focus on preparing for what's possible. The key themes to watch include:
Tariff uncertainty: The full ramifications of 2025's trade actions may still unfold.
AI profitability: Will the massive investments in AI infrastructure finally translate to bottom-line earnings?
Global diversification: After years of US outperformance, international markets may offer relative value.
Bond attractiveness: With higher rates, fixed income finally looks compelling again.
Q5: What's the single most important investment lesson from 2025?
It bears repeating: have a plan and stick to it. 2025 offered both fear (April selloff) and greed (AI rally) in spades. Investors who reacted emotionally to either likely underperformed. The goal isn't to predict the next twist—it's to build a portfolio that can weather whatever comes, and to have the discipline to stay the course. That's exactly what we aim to provide for our clients: we carry the mental burden of planning and monitoring so you can focus on actually enjoying retirement.
