The Inside Track – December Insights

2 December 2025

Welcome to the Fifteenth Edition of The Inside Track!

As we reach the final stretch of the year, many of us pause to look back on the months behind us, thinking about what went well, what surprised us and what we’d like to carry into the new year. This month’s mailer follows that same rhythm. It’s a little more reflective as we wrap up 2025, and we’ll return to the usual depth and detail in 2026. For now, I hope this offers something useful as you reflect on the year and look toward the new one.

Market Indicators

Returns % (to 24 October 2025)

What 2025 Meant for Your Money

This year asked a lot of investors. Markets across the world moved in different directions at different times, and the story often changed far quicker than anyone expected. Even so, we end 2025 in a more positive position than many would have imagined earlier in the year. The US remained a major driver, with the S&P 500 recovering strongly in November to notch its seventh straight monthly gain.

But it wasn’t only the US. Parts of Europe steadied after a difficult start, the UK showed better momentum into the second half of the year, and Australia and Asia delivered pockets of strength despite their own challenges. Emerging markets softened slightly in November, but they still hold a lead for the year.

Here at home, there were encouraging steps that sometimes get lost in the noise. Local equities, bonds and property held up well, providing balance when global markets were unsettled. South Africa received an outlook upgrade from S&P, and financial flows continued to improve after the grey-list exit. Electricity supply was more stable than in recent years, private energy projects continued to expand, and early progress in rail and port operations supported trade. The Rand saw periods of resilience, inflation became more predictable, tourism kept recovering and, on a lighter note, our sports teams managed to lift the national mood more than once.

Despite the swings, we end 2025 with a steadier backdrop and a sense that progress, even if gradual, is still happening. It gives us a solid foundation as we look toward 2026.

What May Shape Your Wealth and Portfolio in 2026

There has been a lot of discussion this year about whether parts of the global market, especially anything linked to AI, are priced ahead of what future earnings may justify. Some investors see parallels with the dot-com years, while others believe the investment behind AI may support growth over time. These conversations will continue, and at some point we will see corrections, as we often do. They can feel uncomfortable while they happen, but recoveries have historically followed. Trying to time them usually causes more harm than the correction itself.

Policy will no doubt be what everyone keeps an eye on next year. The US is expected to appoint a new Federal Reserve Chair soon, and this will influence how markets think about interest rates, inflation and overall financial conditions. At this stage, much of the speculation centres around Kevin Hassett, who is broadly viewed as less aggressive on interest rates and more aligned with the current administration’s approach than the other candidates. Tariffs and other policy changes may add some noise along the way. This is normal and part of the environment we invest through.

The outlook for large technology companies will remain a major talking point next year. The simple truth is that no one can say with confidence whether current prices will line up with future earnings, or whether the market may pause and settle before the next leg. These companies can move sharply in either direction, and periods of strong growth are often followed by phases of consolidation. This is normal market behaviour. For long-term investors, the focus remains on being steady, diversified and realistic rather than trying to interpret every short-term movement.

It’s advisable not to adjust your spending purely because portfolio values have had a strong run. Much of the recent strength, especially in the US, is based on forward-looking expectations, and those can shift quickly when policy or sentiment changes. Investment values move in both directions. Keeping spending measured and maintaining healthy cash reserves helps you stay steady through those swings. And if you have a long-term plan, it can help not to check values too often. A sound plan needs time more than attention.

As we head into 2026, a steady, diversified and grounded approach remains one of the most reliable ways to navigate whatever comes next. It helps to be clear on what you hold, why you hold it and the time horizon behind it. That clarity makes it easier to stay anchored through periods of change.

Food for Thought

Two woodcutters started work at the same time each morning.
One worked flat out, barely stopping to catch his breath.
The other took a break every day at midday and disappeared for about an hour.

At the end of each day, the second woodcutter always had a much larger pile of chopped wood.

Frustrated, the first woodcutter finally asked,
“I don’t understand it. I work without stopping. You take a long break in the middle of the day. How do you still end up cutting more wood than I do?”

The second woodcutter replied,
“While you carry on working, I go home and sharpen my axe.”

The moral of the story
A small pause at the right time can often take us further than constant effort.

Quote for the Month

“Almost everything will work again if you unplug it for a few minutes… including you.”
— Anne Lamott

A Christmas Gift to Yourself (or Someone You Care About)

If you haven’t already read it, this may be a nice choice for the Christmas break. It’s an uplifting story about unexpected connections, the quiet resilience of ordinary people, and an octopus in captivity who sees more than we might expect. It’s gentle and heartfelt, and one of those books that may leave you feeling a little lighter when you close it.

Perspective for the Long Run

As the year slows, many people notice the same feeling. It has been another full year. Early mornings. Long hours. Moments of worry. Moments of joy. A sense that life moved quickly while we tried to keep pace with it. Most of us worked more than we planned to, earned a little more or a little less than expected, and told ourselves we would make space for life later, when things eased up.

It is a familiar cycle. We often lean on the idea of a future version of ourselves who will be more rested, more organised, less stretched. Future Me will have the time. Future Me will make the changes. Future Me will start living differently.

But at this point in the year, a quiet truth becomes clear. Future You is still you. The same thoughts. The same heartbeat. The same hopes. And the one thing that never expands is time.

Looking back, the most meaningful moments were rarely the big plans. They were the small ones. A slow morning with someone you care about. A walk that settled your mind. A laugh with a friend. A moment with your children or your pets. A reminder of what it feels like to be present instead of rushing.

Those moments shape how we feel more than we realise. They restore us. They give the year its colour. And they are the moments most easily postponed.

So here is a gentle tool for the weeks ahead, before we hit the ground running again in 2026:
“What brought me real joy this year, and how can I make a little more room for that next year?”

As this year ends, I hope you find a moment that reminds you of what matters most, and that the year ahead brings more of the people, the routines, and the small moments that stay with you long after they have passed.

I wish you and your family a blessed Christmas and New Year. And if you can, don’t forget to sharpen your axe.

I hope this month’s mailer offered something useful to think about. The next one will be out toward the end of January 2026.

Until then, I’m always just a click away.

Take care, and enjoy the moments that matter.

Rob