Every following January, when looking back, we are reminded of the same truth: predictions make for great headlines, but poor investment strategies. 

Over the last few years, we’ve intentionally avoided publishing bold forecasts. Instead, we’ve focused on educating clients, grounding decisions in data, and thinking differently about risk, opportunity, and behavior. 

So rather than predicting what will happen with markets in 2026, we will once again simply outline some broad expectations grounded in history: 

1. What Everyone Agrees On Will Likely Be Wrong 

Consensus is comfortable. It’s also usually overpriced. 

Some examples of consensus opinions we are hearing these days: 

• Avoid U.S. equities because of political uncertainty 

• The dollar will lose its status as the world’s reserve currency and be devalued  

• International markets will outperform because the U.S. has led for too long 

 
History suggests otherwise. 

• Over the past 100 years, U.S. equities have outperformed most developed markets despite political cycles, wars, recessions, and crises. 

• The U.S. dollar has been declared “doomed” dozens of times—yet remains the dominant reserve currency (~59% of global FX reserves, based on IMF data). 

 
Markets price in consensus before it becomes obvious. When everyone agrees on the outcome, the opportunity is often already gone. 

2. Time Does Not End Bull Markets 

A common narrative today: “Markets are overdue for a downturn because they’ve been up for three straight years.” 

That’s not how markets work. 

• Since 1950, the S&P 500 has had multiple streaks of 4–5 consecutive positive years. 

• Bull markets do not end because of age, they end because of excesses, tightening financial conditions, or economic slowdowns. 

The duration of a bull market is not a risk factor. Fundamentals and liquidity are. 

3. Volatility Will Rise—The Question Is What You Do With It 

With geopolitical tensions, elections, central bank shifts, and technological disruption, volatility is almost guaranteed. 

The most successful investors realize that volatility is not the enemy, it is a source of opportunity. 

• The VIX index historically spikes during periods of uncertainty, and these spikes often coincide with some of the best long-term entry points. 

• Investors who rebalanced during volatility in 2008, 2020, and 2022 were rewarded. Those who “froze” were not. 

The real differentiator in 2026 won’t be market direction, it will be investor behavior. 

4. The Inflation Consensus Will Probably Be Wrong (Again) 

Last year, we took a contrarian stance that inflation would fall faster than expected. That view proved correct. Read our early-2025 post here.

Today’s narrative is that inflation is “sticky” and will remain structurally higher for longer. 

History suggests caution adopting these types of narratives. 

• U.S. CPI peaked above 9% in 2022 and fell dramatically within 18 months. 

• Long-term inflation expectations (10-year breakeven) remain anchored near 2–2.5%, suggesting markets do not believe in runaway inflation. 

Inflation is cyclical, influenced by supply chains, demographics, technology, and policy. Structural deflationary forces like AI, automation, and aging populations are still very much alive. 

5. Market Leadership Will Continue to Broaden 

2023–2025 was dominated by mega-cap growth and AI leaders. In early 2026, we are already seeing signs of broadening: 

• Small-cap and value stocks have started the year strongly. 

• Historically, when the Federal Reserve eases financial conditions, smaller and more cyclical stocks tend to outperform. 

A broadening market is a healthy market, and an opportunity for active investors who look beyond headlines. 

The Bottom Line: Following the Status Quo Gets You Nowhere 

Markets price in the obvious, and reward investors who are positioned to benefit from what comes next. 

That’s why our approach is not about reacting to headlines. But rather: 

• Building resilient portfolios 

• Balancing a disciplined “core” portfolio, with an “explore” sleeve for alpha 

• Preparing for multiple outcomes rather than betting on one 

• Training clients become better investors, who react thoughtfully instead of emotionally 

The year ahead will bring surprises, it always does. Our job is not to predict them, but rather to be prepared for them. 

If you’re curious how we’re positioning portfolios for a broadening market and shifting macro environment, give us a call anytime, we’re always happy to walk through our thinking.