If you judged this past year by the headlines alone, you’d probably describe it as stressful, uncertain, and exhausting.
If you judged it by the results, you might describe it very differently.
In 2025, the S&P 500 Index* completed its third consecutive year of double-digit returns, finishing up 17.9%—despite experiencing a meaningful pullback of roughly 15% in April. Looking back over the last three years, the cumulative return totals approximately 86%!
That gap—between how many investors felt and how the markets actually performed—is the story of what happens when markets refuse to behave.
What was supposed to happen.
Despite a steady stream of forecasts, warnings, and noise, the year ultimately delivered stronger results than many expected. Recession calls came and went. Interest-rate fears dominated conversations. Volatility showed up at inconvenient moments. Yet through it all, markets continued to move forward. The constant coverage didn’t just inform—it created emotional drag. For many investors, the experience felt far worse than the numbers ultimately justified.
Of course, not everyone experienced the year the same way.
Some investors look back and think, “I held more bonds or cash and didn’t see those returns.” Others may say, “I stayed invested and things worked out.” Both reactions are understandable. And neither tells the full story. A single good—or bad—year doesn’t make or break an investment portfolio. A lack of strategy does.
Remember, many forecasts heading into 2025 warned of a recession. Concerns about stock market bubbles were common. When predictions pile up like that, it’s easy to forget that markets don’t move on consensus—they move on reality.
So what should you do as we head into another year? Will markets be up, down, or sideways? Will inflation rise, fall, or remain range-bound? What about interest rates? The truth is, none of these questions can be answered with 100% certainty.
What can be controlled is preparation.
Remember strong markets tend to hide weaknesses. That’s why the best time to review, rebalance, and stress-test an investment portfolio is now—when things are going well, not during the next downturn. Just as important as returns are strategies for cash reserves, taxes and aligning your investments with your goals—not market forecasts.
And remember: Markets can misbehave in both directions.
Sometimes expectations are grim and results surprise to the upside. Other times, optimism runs high and outcomes fall short. A well-built plan helps navigate both. If this past year felt harder than the results suggest, it may be a good time to step back and make sure your plan and investment portfolio is doing what it’s meant to do: helping you stay on track when emotions and headlines are working against you.
Please reach out to hello@newstageinvestment.com or call 650-458-0312 or just schedule a call today online: Start a conversation today
We are here to help!
Hans
*Disclosure: The S&P 500 Index is a capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries. All performance referenced is historical and is no guarantee of future results.