The first half of 2025 is in the books, and perhaps in the history books. Against all odds global stocks have delivered over 10% in U.S. Dollars in 2025. The U.S. market (S&P 500) offered about 5.7%. Of course the economic backdrop (noise) is a U.S. President hell-bent on a global tariff war and an unwinding of the globalization that helped drive the generous market returns and economic growth over the last few decades. Canadian stocks are up more than U.S. stocks, even though Trump continually threatens to destroy Canada, economically. The markets are not buying – ANY of it. More proof of the mantra of this blog – get an investment plan and stick to it like glue. Global portfolios are up nicely, on the Sunday Reads.
Before Trump took office (and on Seeking Alpha) I suggested that investors could (and should always) ignore who inhabitated the White House.
Democrats’ stock returns beat Repuplicans’, but it still doesn’t matter who wins.
The economic strength of the U.S. is a much more powerful force than the pen in the White House.
Given all of the unpredictability I did offer an idea or two for those who wanted to manage the risk, including gold (up 23% in 2025). From the Seeking Alpha post, and there’s that ‘glue bit’ in again.
2025 was a rocky road
Now that’s not to say that 2025 has not been an adventure for investors who might pay too much attention to the news and predictions. In fact, Trump’s first 100 days were the worst, except for Nixon, over the last several decades.
At the bottom in early April, I suggested you should enjoy those lower stock prices, no really! I didn’t know things would turn around, but they did. Nobody can predict short term market direction, of course.
And the risk management ideas (not advice) that I put forward on Cut The Crap Investing came through again. During the market decline the defensive equities did their thing, and were the top performers in the first quarter. Be sure to check out …
Defensive equities take on tariffs.
Here’s the performance of U.S. defensives, we saw the same event in Canada (for defensive equities).
Of course, those are strategies I explore in more detail for Retirement Club.
In retirement, risk management can become more crucial. I like using defensive equities in concert with bonds, cash and gold. It turned out to be far superior (again) to traditional risk management.
2025 equity returns
Here’s a quick scorecard.
International developed equities (EFA) are up 20.5% in 2025, in U.S. Dollars.
Canadian equities are up over 9.0% in 2025, you can add a 5% currency boost as well if you’re a U.S. investor. Yes, the Loonie is outperforming. That that is certainly loonie to many.
U.S. stocks (XUS-T) in Canadian dollars are essentially flat in 2025 thanks to the weakness of the U.S. Dollar.
And once again, as per the opening for this post, the international exposure greatly helped boost the returns of a global stock portfolio (VT) vs U.S. (IVV). Global stocks greatly outperformed the U.S. markets in 2025, and there is a considerable currency boost for holding non-U.S. assets as investors flee the Dollar.
Asset allocation ETFs – global portfolios
If we look to the 2025 returns for the wonderful Canadian asset allocation ETFs:
- iShares XCNS – 3.27%
- iShares XBAL – 3.77%
- iShares XGRO – 4.79%
- iShares XEQT – 5.58%
The above returns do not include the positive returns on June 27th, so add a slight boost. For example, XEQT was up 0.8% on the day. And all said, it was a very good first half for global balanced portfolios in Canadian Dollars.
Buy / hold / add / keep your fees low = success
Successful investing is easy, eh?
End of U.S. exceptionalism? Global has you covered.
Sure the markets are suggesting that U.S. exceptionalism is coming to an end, or at least the dominance will fade. Who knows? But it doesn’t matter with a global portfolio, because you’re also holding the regions/countries/stocks that will benefit from the event. The markets are guessing that Europe and Asia will be there to pick up the slack. But no need to guess, you’ll hold the new “winners”.
And yes, if you’re holding mutual funds remember …
Canadians should avoid most mutual funds and the high fees.
You can move to one of the asset allocation ETFs. They are managed global portfolios with super-low fees. Use that Contact Dale form if you want to know how to leave behind those wealth-destroying high fees.
If you want advice, financial planning and low fee ETF portfolios, aka you want it all –
Check out Justwealth Canada’s top Robo Advisor.
Here was an interesting snipit from the Globe & Mail this past week – –
An investment in, XIU-T – which holds a basket of Canada’s 60 largest companies – posted a 20-year total return, through May 31, 2025, of about 8.4 per cent annually. Assuming all dividends were reinvested, an initial $10,000 investment would have grown to about $50,125. Wow, now that’s some wealth creation.
The oil markets head fake the experts
Here’s a Tweet that sums up last week after I asked if “you got oil and gas stocks“.
For the record, I will always hold our oil and gas stocks, including pipelines. That’s a perpetual hedge against an oil shock and inflation. And I really like the Canadian Big 4 oil and gas stocks 🙂
More Sunday Reads
At Findependence Hub a look at the fee cut for BMO’s asset allocation ETFs.
Let’s do the Math
Say you invest $50,000 in an Asset Allocation ETF and leave it for 25 years, earning an average return of 6% annually:
- With a 0.18% fee, your portfolio would grow to around $204,384.
- At a 0.15% fee, it would grow to $205,926.
That’s $1,542 more in your pocket just from a lower management fee. And remember: this is with no extra effort, no added risk, and no change in your investment approach. Just more of your money working for you.
Also on the Hub, can investment properties help your financial future?
Bob at Tawcan offers his May 2025 portfolio update post.
GenyMoney offers her mid-year review and portfolio update.
It’s a quiet week at Dividend’s Hawk portfolio week in review. We shared in some dividends from Manulife and Qualcomm. And there was an overview on the staple General Mills (GM) …
General Mills, Inc. (GIS) Reports Fiscal 2025 Fourth-quarter and Full-year Results and Provides Fiscal 2026 Outlook; GIS reported fourth-quarter Non-GAAP earnings per share of $0.74, representing a 27% decline year-over-year, though it still beat analyst expectations by $0.03. Revenue for the quarter fell 3.2% to $4.56 billion, falling short of estimates by $40 million. For fiscal year 2026, management issued the following guidance: Organic net sales are expected to range from a 1% decline to a 1% increase. Adjusted diluted EPS is projected to decline by 10% to 15% in constant currency, based on the fiscal 2025 baseline EPS of $4.21.
Banker on Wheels weekend reading and watching welcomes us with this tidbit on gold and the U.S. Dollar
In the mix – expected returns for stocks. And speaking of the first-half market wrap Banker linked to the visual capitalist look at global performance.
Hong Kong, Germany and Italy were out in the lead and then …
Also via BOW: Retirees doing better with less.
At Stocktrades, is BCE a buy after the dividend cut? Bell kept increasing the dividend while this was happening …
Worth a re-Tweet, July is good for stocks …
… money and happiness …
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OUR SAVINGS ACCOUNTS
Make your cash work a lot harder at EQ Bank. RRSP and TFSA account rates are at 1.75%, other savings rates up to 3.0%. You’ll find some higher rates on GICs up to 3.60%. They also offer U.S. dollar accounts at 3.0%. We use EQ Bank, they have been awesome.
OUR CASHBACK CREDIT CARD
We make between $40 to $70 every month! And that’s on everyday spending. There are no fees with …
The Tangerine Cash Back Credit Card
For May we received $34.28 in cash. It was our lowest month of spending in years! You can select 3 categories for 2% cash back. The rest pays at 0.50%. That’s one of our lowest spending levels of the last several years. Our fuel bill is way down and so is our grocery bill.
That cash went into my TFSA account to help buy some CBIL-T and HUTS-T.
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