I’m not ignoring any of this. But I do what I all the time do: stay disciplined, do my research, give attention to finding value, all knowing that there can be market fluctuations and I’ll should adjust the portfolio as needed. It’s not sexy, nevertheless it works. It is a foundation for constructing a powerful portfolio that may withstand the challenges of the market.
Let’s take a fast look back at 2024 and see how Canadian investors are positioned for 2025.
In some ways, 2024 was very just like 2023. Technology stocks, driven by the substitute intelligence (AI) bandwagon, led the markets. Big-cap technology corporations (i.e. the Magnificent 7: Apple, Alphabet, Amazon, Meta, Microsoft, Nvidia and Tesla) were the market leaders.
However, things modified in September, when the US Federal Reserve cut rates of interest by 50 basis points – the primary rate cut in 4 years. This set the stage for more sectors to hitch the market rally. Lower rates of interest and robust economic data created an environment wherein investors could and did do well.
Thanks to a smooth US presidential election – and by that I mean that the outcomes got here quickly, were clear and were unchallenged – the market rose even further. With just one month left in 2024, the US economy is doing extremely well.
From a market perspective, we’re leaving 2024 as we began it – on a high.
What awaits the markets in 2025
Historically, November, December and January are one of the best months of the 12 months to speculate. When it involves investing, there’s an old saying: “As January goes by, so does the year.”
And I believe that the saying will even apply to the 12 months 2025. I do not expect one other 12 months of gains above 20% in 2025, but I see more traditional returns of around 10%.
