The final quarter of 2025 was somewhat representative of the entire year: Canadian equities generating very strong returns, followed by positive gains in international markets, with the United States a bit lower, but still quite good. Bonds, likewise, remained well behind the pace of equities and arguably, a bit disappointing. Overall, we would hope that most investors would be pleased with calendar year returns in 2025 – another consecutive year of positive returns across all 80+ Justwealth portfolios.
Reflecting on 2025
Coming off back-to-back calendar years of strong performance in 2023 and 2024, many anticipated that 2025 could be a weak year given that over time, everything should balance out to “the average return”. Mathematically, that logic is true, but the average also changes over time, and ultimately that logic has ZERO predictive power: it is only true looking backwards. We would caution all investors not to fall into that same line of thinking now that we have 3 strong years of performance in back-to-back-to-back calendar years!
It did not take long into 2025 before panic set in. On February 1, Donald Trump signed an executive order imposing tariffs on Canada, Mexico and China, kicking off an unprecedented and unbelievable barrage of tariff announcements from the United States which dominated headlines throughout the remainder of the year. On top of that, comments about making Canada the 51st state, and a looming Canadian federal election after Justin Trudeau resigned did not seem like an enticing time to invest in the Canadian stock market. Indeed, we fielded many, many inquiries from our clients looking for change or “action” in our portfolios. Our response, as outlined in our Q1 Commentary was: “…we do not recommend making changes in light of what is currently happening in the markets.”
Despite the adversity facing Canada, our stock market delivered one of the highest returns in the developed world. Canadian small cap stocks, which we hold in our Global Maximum Growth Portfolio, returned almost 50% in 2025! Emotions can often get the best of investors, impairing judgement which can sometimes translate into poor decision making focused solely on the immediate short term. It seems like we mention this every quarter, but we will say it again: focusing on the short term is not a wise way to invest. If you legitimately only have a short-term time horizon, then you should not be taking much risk; otherwise, do not think about the short term at all.
Economically, in Canada and the U.S., it was a decent year, marked by stable, positive growth, with some weakness in employment, and stubbornly persistent inflation. Almost uneventful. Central banks were in easing mode globally, partly due to a reduction in elevated rates on past inflation fears, and partly due to the expectation that growth would be slowing.
Competitive Performance
There are plenty of investment options available to most Canadians, and the reason that Justwealth came into existence more than 10 years ago is because we believed that most other options were (and still are) of poor quality. Better customer service, better investment outcomes, less conflicts of interest, and lower prices all seemed very easy to deliver given the incumbent providers.
On the “better investment outcomes” component, we offer 80+ distinct portfolios, each of which has a well-articulated definition. Our wide range of options allows for better customization, properly aligning clients’ investment objectives with their portfolio holdings, instead of lumping everyone together into one of only a few different options.
Addressing performance comparisons, we update our portfolios’ performance quarterly relative to the equivalents from the Big 5 banks in a few different risk categories. Every update, we convincingly validate that there is a better way to invest compared to traditional options. The table below illustrates the results for the “Balanced” risk category.
It is worth noting that the gap between the average bank return and Justwealth in the Balanced risk category for the 5-year period WIDENED over the past year from outperformance of 3.55% to 3.83% (per year!).
Regarding our online competitors, information is difficult to find on their performance (even though we willingly update performance monthly on our website), but every third-party comparison that we have participated in seems to have Justwealth rated #1 for longer-term performance. In the near term, we don’t expect that to change from previous years’ results. Justwealth would much prefer to be renowned for top-rated investment performance, not endless television commercials or amazingly lucrative and trendy, one-time sign-up incentives…that is the difference between earning your business or buying your business!
Looking Forward
Well, if you didn’t like the headlines in 2025 (particularly those coming from the United States), we don’t expect that you will enjoy the headlines in 2026 either. It took all of a few days for Trump to “stir the pot” in Venezuela in 2026. The Canada-U.S.-Mexico trade agreement is up for review in 2026, and we believe that it would be wise to expect nasty political rhetoric from all three countries as negotiations heat up. Get used to it.
We are barely into 2026, and we are already getting client inquiries about preparing for the inevitable stock market collapse due to Trump’s most recent actions. If you consider yourself in that category, please go back to the beginning of this commentary and start over again until you can confidently assert that “Negative headlines do not equal negative stock market returns”.
Donald Trump is not the U.S. stock market, he is not the U.S. dollar, and we do not invest in Donald Trump. Donald Trump is interested in enhancing the prosperity of the U.S.; the companies that we invest in are interested in making profit. Both American and non-American companies are run by intelligent businesspeople – they will adapt to the changing terms and conditions created by the politicians, and history has shown time and time again, that stock markets prevail and outlive the actions of any political figure, economic challenge, or other kind of threat.
Before Trump (the second time around), economics seemed to be the topic that was the focus of most investor concerns: GDP, productivity, that sort of thing. We believe at some point, this will become the primary topic of concern again, maybe just not until Trump is no longer in power. Regardless, we think inflation may be the most important economic variable to watch in 2026. The upward spiral that happened a few years ago has never been fully fixed, even if it has improved/lessened somewhat. Interest rates are lower (stimulative), the economy has remained resilient, is even seemingly accelerating recently, and central banks have softly guided that they may be forced into raising rates rather than cutting further. Employment remains a secondary concern, and it adds an element of complexity to central bank decision making.
We would like to thank all of our clients for trusting Justwealth with your investments. We take our role seriously – telling you what we believe in and consistently managing our portfolios in a manner that has served our investors’ interests well. We will always look out for your best interest.
Best wishes for 2026!
Here is a recap of market performance as of December 31, 2025*
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