2026 Mid-Year Market Update: Performance, Trends, and Misleading Headlines

On this episode of the Canadian Money Roadmap, Sam and Evan discuss how the markets have performed over the first half of 2026 covering how international stocks (especially South Korea) are outperforming the US, value stocks are beating growth stocks, the Magnificent Seven have stalled, and speculative assets like Bitcoin and gold have failed to act as expected hedges.

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Transcript

SPEAKER_01 0:00

Well, now that we're into July, we are halfway through the year. So we thought it'd be fun to take a look at the year so far here in 2026 to see what has happened in the investing markets. We hear from many people some things that they think are happening in the markets, but there's a lot of stuff going on underneath the surface outside of the typical headlines. So I hope you will enjoy this episode of the Canadian Money Roadmap, where we dig in some of the details of how the first half of 2026 has gone. All right, Sam, we're recording this halftime report during halftime of the Spain-Portugal match. What are your thoughts on the World Cup so far?

SPEAKER_00 0:36

Oh, well, it's been a very fun tournament. It's just kind of heating up, getting some of those big matchups like today, Spain-Portugal. You know, that's a the clash of two titans of the European soccer world.

SPEAKER_01 0:46

So And a little controversial one later this afternoon with the with the Americans and Belgium with the red card suspension that that has not been.

SPEAKER_00 0:55

Well, we know that FIFA is an above-board organization through and through. Absolutely. Absolutely.

SPEAKER_01 1:00

So yeah, no questions there. But yeah, this episode, we are halfway through 2026. And here at Cedar Point Wealth, we try to focus primarily on financial planning, a lot of the stuff that we can control, but we also recognize that the investing piece is part of both what we do and an important piece of everyone's retirement planning puzzle. And so just taking a look at what's gone on in the markets is fine. If anything, it's just interesting. A lot of the stuff we can't really control, we'll get into the parts of it that we can control. But uh yeah, I thought we we would probably start with going through some of the things that we've noticed this year. Let us know. You can reach out to us. What are some of the stories that you're seeing and hearing about? We're always interested in uh as to what's top of mind for you as listeners, so feel free to reach out to us and maybe we can talk about it here on the podcast.

SPEAKER_00 1:47

Yeah, and so I think one thing that we were talking about in preparation for the episode was kind of the the tension or the the kind of the relationship between perception and reality when it comes to investing and the market. And I think often there's lots of noise and lots of headlines about particular things that really influence people and what they think is going on, but today we kind of want to dig down. We want to talk about a few of those stories that have influenced maybe the perception of what's going on in the investing market and see whether that bears out in the data in the first six months of the year.

SPEAKER_01 2:19

For sure. Because I I'm typically of the belief that the media is um usually trying to drive a negative narrative because it's like if it bleeds, it leads, you know, like that whole concept of like if it's if there's something negative or something extreme or something like that, that's worth talking about. It's like, yeah, we're having another really good year. It's like who wants to read that? So it's like trying to find like the is there a bubble? What's going on with this? So like some of the things that you're probably hearing about are, of course, the major conflict in the Middle East with the United States and with Israel and Iran, ongoing wars with Iran and Palestine, but also what's going on with Russia and Ukraine, and a lot of this revolves around oil. So oil prices kind of playing into those conflicts as well, but also, you know, more domestically, perhaps, is like the stories around AI. And we keep talking about this AI bubble or hearing about it anyways. We've talked about it here on the podcast. But, you know, these sorts of things and major companies go in public like SpaceX, but it's not profitable. And there's always political instability all over the world. The British prime minister just resigned, and up here in Canada, maybe we don't think about that, but it's like, yeah, this is major stuff, you know, that's going on. The Americans are going into a midterm year here, which is always interesting. So there's always this upheaval and and all sorts of stuff going on, but maybe that's the point, right? That there's always something going on, and these don't necessarily always drive the performance of investment markets. It's it's usually noise a little bit, right? Because markets are trying to, you know, evaluate whether this actually has an impact on profits, because that's predominantly the thing that moves stock prices, but interest rates, different currencies, investor expectations, current valuations, and economic growth in other countries, right? There's there's so many factors that are intermingled. It's not any one news story or anything like that that's actually gonna drive the performance of the market. Aaron Powell Yeah.

SPEAKER_00 4:21

And I think in the case of some of these conflicts and the limited supply of oil at different points in time, it it's maybe easy to make the assumption that that kind of would impact the markets more broadly. So let's dig into what we're seeing as far as performance in this first little while, and then we're gonna pull out a few interesting findings and topics that we've come up with to chat about those and what we're seeing. So the first topic we wanted to just discuss was the global market performance so far this year. And to do so, we wanted to break it down into a few key categories: US markets, which is US is often seen as the driver of global market returns or investment returns, non-US stock, so developed countries, major countries like Canada, Japan, the EU, places like that. And then the third category would be emerging markets. These are developing economies in the world. And we see some pretty interesting comparisons between how those different categories are doing thus far this year.

SPEAKER_01 5:20

Yeah, like last year, the story was kind of similar, actually, um, which was kind of an underreported story, I think. The US has often been the place where investors default to because a lot of the stories suggest, like, ah, you should be in the SP 500. Like we can probably do better than this, but that that is a common thing that people know. They're big companies, of course. But investing outside of the SP 500, investing outside of Canada has a ton of value. And last year in 2025, pardon me, I'm having a little bit of brain fog here last year, that the US was one of the worst places to invest compared to many other countries. So you can see here on our chart here that let's just use in the US dollar terms, just so that we have a standard without the currency. Just in US dollars last year, the SP 500 was up just shy of 18%. But then if you look into the non-U.S. developed markets, you know, we're looking at 33.1%, emerging markets 34.4%, you know, some pretty strong returns. And the US, like that's nothing to sneeze at there, like 17.9. But US exceptionalism is not always necessarily the case. And what we're seeing here again this year is something pretty similar. So we're looking at, again, let's just use common currency, which isn't always the case, right? So like we don't necessarily recommend currency hedging, but just so the conversation can focus on one thing at you know at the most at this point. This year, and this is from JP Morgan's guide to the markets, this is current as of June 30th, so the end of last month, so six months through the year, the SP 500 is up 10.2%. Again, that's in US dollars. Then you look at non-US developed as 14%, and then emerging markets up as much as 24%. You know, if you're just investing in the SP 500, you know, you did just fine. You know, that's a really good year this half so far, right? It's like we we kind of hope for that like six, seven percent per year. If you can get in the ballpark of double that, boy, it's like pretty tough to complain. There is pretty fantastic returns so far. But the US has not been the absolute best place to invest, again, for the second year in a row here for sure.

SPEAKER_00 7:36

And this is kind of a trend that which particular markets will do better in any given year is always changing, right? Dimensional has some great research about kind of the top, they looked at 20 or 25 different countries, and every year there's a different country that has the best return, typically, and there's all this variability. So this is just another re or this is a reason why this international diversification is so essential, and it's punctuated this year by some of the countries that have done well or not so well. And so this year, this graph from JP Morgan, Korea in US dollars is up 118% at this time of year. That's pretty good. That that'd be a good few years, not just a good half year. That's a good year this year.

SPEAKER_01 8:17

It's a good it's been a good decade this year.

SPEAKER_00 8:19

Yeah, exactly. So just if you miss out on the Korean market this year so far, you'd your result would be a lot different. So having that diversified, internationally diversified portfolio can help you capture the returns in those countries that do really well in a given year.

SPEAKER_01 8:37

For sure. And you you look at this list, right? Like there's a lot of major economies so far this year that actually have negative performance, right? Like China and India. That doesn't mean that they're not growing. It doesn't mean that they don't have good businesses there or anything like that. But it's just the stock prices on average are they underwater this first half of the year. Now, Korea is where I like to I'd like to go there next if you're okay with that, Sam. Go for it. Because South Korea has a fun little wrinkle as it relates to some very popular Canadian ETFs. VEQT and XEQT, these are the globally diversified all equity portfolios from Vanguard and BlackRock. Now, how does the South Korea story fit in with those? Well, both of them are globally diversified and both of them have exposure to South Korea. That makes good sense. They're a major economy. However, the way that each of their underlying indexes are constructed, one of them considers South Korea to be an emerging market, and the other considers it to be a developed international stock. It's like, who cares? But the weight within the portfolio, like how much of it it actually owns, is different because the emerging market sleeve is quite a bit smaller than the developed international. So the Vanguard portfolio, VEQT, owns just north, just a hair over 2% of the portfolio in South Korean stocks. And XEQT from BlackRock is just barely over one percent, pardon me. So 1.16% versus uh a little over two. And so the difference between the two is 0.85%. So in most years with run-of-the-mill type performance from this one country, you might not notice a difference. However, this year, because South Korea is up 118% in US dollars, but in local currency, it's up 135%. This is a pretty significant driver of the difference in returns between the two. Now, just because of where things are in any given day, I'm not going to get into that a little bit, but if you own both of those or one of the other and you're like, what's going on? Why are they different? Like, I thought they were kind of interchangeable, except for like a hundredth of a percent in fees or whatever it is now. It's like honestly, it's probably the South Korean allocation between the two because of the um emerging markets designation versus international developed. And so, you know, this isn't as simple necessarily as just taking the the difference and multiplying it by the the uh the returns that we've seen so far to find the differences because there's a number of these other incongruencies between the two ETFs, but it's part of the story, right? So, like I'm not saying you should now go out and buy the Vanguard one if you had the BlackRock one or anything like that. I'm not here to make securities recommendations to to any of you who are listening or watching this episode. But just to say that these quote unquote passive portfolios aren't necessarily 100% passive. That's not a problem, that's just reality, you know. And so investing is a pretty big spectrum and nothing is truly passive. It's like there's always an active component to it, like how certain countries are designated, and then how much of a weight they comprise within the portfolio. So this one is really, really interesting, specifically because of that minor difference between the two and the massive performance that we've seen. Even last year, I'm looking at this chart again, Sam. Last year, Korea was up over 100%. You know, so it's like we got back-to-back years here, over 100% so far. It's pretty crazy.

SPEAKER_00 12:25

Yeah, for sure. And then this, I guess the XEQT uh V kind of distinction, not to say that um, you know, you gotta run out and make sure you've got more Korea allocation now, but just an interesting example of how some of these products are put together, even though they are globally diversified. So you're still both products would still be exposed to uh the Korean market. It just can account for some differences because there are these products do have some differences and idiosyncrasies that that shape their returns.

SPEAKER_01 12:54

Yeah. It's just interesting more than it is like a an indicator of what you should be doing. But anyways, fun little wrinkle there with the difference in those two ETFs. So like the international side of things is probably you know criminally underreported, right? It's like everything is always about the biggest companies and whatever, but you know, you take a look at that and be like, oh my goodness, Taiwan and Korea, they're really taken off. And Japan's had a pretty nice year here as well. You know, the Taiwan and Korea, by the way, like most of the the drivers of that performance is coming from both chip stocks, like so it's part of the AI boom here, and also RAM, so random access memory. This is I'm I'm kind of digging into the vault of what I remember from computer science and the the terms around technical computing things. But RAM, like the the the memory for computers, is pretty necessary for for processing, you know, all the AI stuff that's that's going on now. And there's a massive shortage, and there's only a few companies in the world that make it. Two of the biggest ones are Samsung and SK Heinex. They're based out of Korea. That's where the bulk of that performance is coming from. It's not necessarily that, you know, Korean cars or anything like that are suddenly flooding the markets or anything like that. It's probably the AI story. So you might be thinking, like, okay, if we look at international markets, it's like, yeah, it's a lot of these international companies that are kind of driving a lot of the returns, and maybe it's hype driven and whatever. It's like, are these stocks now getting really, really expensive? And I would say it's really tough to look at individual stories and then extrapolate that over broader markets. Because if you take a look at the next chart here, we're gonna show how valuations internationally have actually stayed quite a bit cheaper than their counterparts in the US, depending on which sector that you're actually looking at.

SPEAKER_00 14:47

Yeah. So this chart again from the JP Morgan Guide to the Markets shows the forward price to earnings ratio of different sectors compared to the SP 500. And very interesting because although we're seeing these returns in some of these uh sectors are even cheaper than on average in the last 20 years. So that's one point to see that despite uh kind of these high investment returns, some of these sectors, the price of stocks is getting a bit cheaper. But also, as we can see on the graph, healthcare, utilities, commercial services, energy, all these different areas, the average price of some of the international stocks is well below what the SP 500 cost would be. For sure. Yeah.

SPEAKER_01 15:28

So like the the pricing or the the valuation of stocks across the board. Now, this isn't looking at individual countries. There's always going to be stories and individual names that like buck this trend for sure. But international stocks have been way cheaper than their American counterparts for a long time. And that kind of makes sense because the growth of those American companies has been a lot higher, but you pay for it, right? It's nothing is free. The market is widely participated in by people that have all the data and everything, and the prices bake in the information, right? And so, you know, when you take a look at these international stocks, and now that they've had a nice run-up here, it's not, it doesn't necessarily flip-flop all the way. It's like they're still really cheap. They're still quite a bit cheaper than U.S. counterparts. And, you know, why does that matter? Well, value stocks typically, if we take a look at what the research suggests, and that's in Canada, the US, internationally as well, value stocks typically outperform growth stocks over time. Now, that's something that you'd expect every day in the markets. It won't happen every day, but just based on what the evidence suggests, you can expect lower priced stocks to perform better. Now, valuations are not an indicator of how you should be trading on a day-to-day basis, you know, as a short-term predictor of returns. But the longer the time period goes, the more likely these things kind of play out over time. So the more expensive a stock is today, the less likely it is to provide positive returns in the future. Not impossible, but just less likely. Whereas the opposite is also true, the you know, lower price stocks relative to profits, assets, whatever, the more likely it is that you can see positive returns on a go forward basis over a long enough period of time. And so we've kind of seen that this year where value investing has kind of come back into vogue predominantly in these places of emerging markets. So so far we've kind of just looked at the broad index, but the value parts of those markets, so developed international, emerging markets, even here in Canada, even in the US, actually, value has had a bit of a comeback.

SPEAKER_00 17:46

Yeah. And so we have another chart from JP Morgan that's just talking about the year to date. So this year, for example, value stocks, this is divided between small, mid, and large cap stocks, have all outperformed growth stocks of the same category, with the highest performer being small cap value stocks at 23%, and a big gap with large large cap value and large growth stocks. Uh large cap value return 16.3% so far this year or up to the end of June, and growth stocks 5.3%. And you know, you can look at different time periods, and you know, if we look at this chart from the 10-year annualized, the growth stocks did very well or you know, outperformed value stocks in that time. So it's not a you know a foregone conclusion, but Dimensional's done lots of research in this area and has seen that you know, over the longer term that value stocks have outperformed growth stocks because they're val they are value. They're a little bit lower than that. You're buying there.

SPEAKER_01 18:45

Yeah, you're actually buying profits and assets for a lower price. It's just easier to make money there over time. Again, like you're seeing there, that 10-year track record, it's not a guarantee. So we don't recommend that people do all value or all growth and flip-flop back and forth. We recommend that you kind of own the market portfolio and then tilt towards some of those factors, including value and small caps, that have some evidence of outperformance over time, especially when you can kind of strip out some of the unprofitable small caps out of there because there's a ton of zombie companies that are out there that kind of skew things a little bit that are pretty much uninvestable. But this year to date is pretty crazy to see that huge spread between value and growth. Now, this is just US. The story of value versus growth is really different depending on where else you look. So, again, part of the global diversification piece is taking a look at where you can actually get outsized returns and leaning into the value stocks in international and Canadian markets in general, too, has been quite a bit better than the story in the US. So, again, we advocate for having a single strategy that you can kind of implement across the board all the time, but it's not always going to be a guarantee, which is why you do the diversification thing in the first place. But it's just very interesting to see that that story in the U.S. has kind of flipped this year, and it probably hasn't been getting any of the attention in the news headlines or anywhere else that you might be looking for investment news.

SPEAKER_00 20:14

Yeah, and and maybe it's a good point to kind of continue on because some one of the other interesting results from the first six months of of the this year is the performance of the Magnificent 7. And so that would be NVIDIA, Meta, Tesla, Amazon, Alphabet, Google, Microsoft, and Apple. I've heard of some of these. Yeah. So, you know, and these would also be the companies that dominate the headlines on financial websites and CNBC and Bloomberg and all these places. And these are companies that have done incredibly well over the last few years for the most part and really driven a lot of this kind of SP 500 returns and things like that. But we've seen an interesting correction in the first six months of this year. And Evan, maybe you want to get into a bit of that data.

SPEAKER_01 20:59

Yeah, so like if you take a look at 2023, you can see these massive returns for like NVIDIA was up over 225%. Meta was up nearly 200% in that year. Meta's Facebook, by the way, Facebook and Instagram. All of these companies were just blowing out the SP 500, and because they make up such a large portion of the SP 500, a lot of the other companies, so like call it the SP 493, they were probably quite negative or like meaningfully under that average. So these companies are so huge, they're dragging the performance of the index up. The same thing was true in 2024, but even last year, it's kind of like the story that we've already talked about, not necessarily the same. He only had a couple of names that were really outperforming the index. Here in 2026, only four out of the seven have positive returns at all. And only one of them, who uh who is it there? Is that alphabet? That's Google's parent company. Um, they're the only one at this point in time that has positive returns above and beyond pardon me, I should say excess returns beyond the S P 500 as a group. So this is really interesting because if you look over the year-over-year earnings growth, part of what drives the performance of a stock is how much money it makes. Believe it or not, this is uh, you know, kind of the main thing. If it makes more money, typically the stock goes up again over time. So then it what we're looking at here in the green bars is the earnings growth, right? So this isn't sales, this is actually profit. So are these companies getting more and more profitable every year? It's like, yeah, it's insane. It's actually really crazy. In 23, 24, 25, and 26, the full year, um, I think that's a forecast there for the year at 38%. It's crazy. It's like, wow, these companies are doing amazing and they're growing like mad and they're actually getting business results. Like, this isn't just hype, like profits are actually growing like crazy. But that isn't necessarily how everything works. So, with these growth stocks, growth doesn't mean the company is going to grow. A growth stock means that you're paying for growth that hasn't happened yet. Okay, so when we go back to 2023 and these stock prices go crazy in 2022, the year before, when everything was getting smoked, so the Meg 7 on average was down 40% in 2022. I believe I'm pulling this out of out of my hat here, but NVIDIA I think got cut in half that year. I think it was over 50%. Again, don't quote me on that one, but it was it was not nice across the board for the Meg 7 companies. But that was when this new technology came out and was like, oh my goodness, ChatGPT, this is crazy. We can do all sorts of things with this. And, you know, investors' wheels kind of get turning, like, okay, who's actually supplying the underlying technology for this? Who's going to benefit from this? And it's like, believe it or not, it's going to be a lot of these Meg 7 companies. And so in 2022, the story was more so an inflation story and kind of unwinding these like metaverse type things and NFTs and some of these like fringe technologies that weren't really materializing into anything interesting. It's like, wait a second, this AI stuff, boom. And so that's what drove the stock price in 2023. It grew because this was before the earnings actually happened. So now the earnings are actually happening, but the returns aren't there because the returns already happened. This is how it works with growth stocks, right? You have to continually outperform expectations over and over and over again. And investors just aren't necessarily thinking that the growth in these companies is going to continue on at the same rate. And so a lot of the growth that people thought would happen has actually materialized, but that's where the returns came from in the last, you know, two, three years came from that expectation that is now materializing. And so the the trains arrived at the station here a little bit, right? These stocks aren't just getting bigger and bigger. In many cases, they're actually getting cheaper relative to their previous crazy inflated valuations. And that makes sense. That's not anything being broken. That just makes sense because the stock market is trying to look forward and try to put a valuation on these stocks today based on the information we have and the speculation that we can do on what's going to happen in the future.

SPEAKER_00 25:30

Yeah, and so this it's it's important to note, so just to reiterate, you know, that the Meg-7 hasn't performed as well or anywhere near as well as in the past few years of crazy growth. This year, we've seen the Meg 7 year to date is up 0% collectively, and the S P 493 is up 15%. So this is a year of kind of uh maybe a coming back to the to the middle where the Meg-7 isn't driving all of that investment growth. But it's important to note as well, this is part of kind of a longer trend. And Dimensional has some really great research about the largest 10 companies in the S P 500 going back to 1927. And we see this plateau for some of these largest companies going back uh, you know, nearly 100 years. So between 1927 and 2025, companies as they got into the top 10, the three years before, they averaged 27.2% returns. And in the three years after they were in the top 10, 0.3%. And those returns even decrease as you go kind of along lot wider timelines. So kind of these this um, I guess, plateauing of returns is pretty consistent of what we see across the SP's history. Yeah.

SPEAKER_01 26:45

So you it's everything's based on a story, right? When you hear the story of like the you know AI being a technology that's like highly usable and you can increase productivity and whatever, it's like it's doesn't take a leap a huge leap to see like, okay, this is probably gonna be something meaningful. It's like Nvidia's the backbone of the technology, you know, the company that makes the the GPUs that can actually run the stuff. It's like maybe I should buy more of that. It's like, well, people thought of that four years ago already, and that's what really drove the the performance, you know, for that stock. So if you're trying to like, oh, I wonder if maybe this seems to be a thing I keep hearing about, you're probably late to the party. We had an episode that specifically addressed that concept a number of weeks ago, but it just keeps playing out that way. So it doesn't mean that good companies are necessarily bad investments, but it doesn't mean that they're guaranteed to be good investments all the time. You know, the the story that you might be buying into might have been one that somebody was buying into four years ago already.

SPEAKER_00 27:48

Yeah, and if we're talking about maybe the most compelling investing stories of the first six months of this year, I mean SpaceX fits into that, right? They had this massive IPO, but it's good to put it in this context of these other companies as well, where you know, there's been some fluctuations in the price of SpaceX, but it's been valued incredibly highly because of the potential of this company to do some amazing space travel and the other components of the business, but you're paying for the projected growth. And so it's it's not profitable today, by the way. Yeah, exactly.

SPEAKER_01 28:21

Just so that's that's clear, and this is not a recommendation for or against a stock. I just have massive apprehension on the concept. You know, it's a two trillion dollar valuation based on the the value of the shares that are outstanding, to like trillion with a T, and they don't have a dime of profits. And you know, I I can hear people screaming at their phones like it's like ah no, no, no, you don't you don't you don't understand it. They're gonna colonize Mars, they're gonna have all this technology and whatever. It's like, yeah, sure, for sure. But it at some point it's gotta materialize. And like, I don't know if I want to be the one holding the bag in the meantime. Like, even a company like Amazon, it's like people thought that they were gonna be, you know, the retail juggernaut that takes out you know Walmart or whatever the case is, and you know, their stock prices going like this. This is like in the tech rec back in 2000, and they got smoked, and then coming in through the 2000s, they kind of decided to change their model a little bit. So, yeah, they do retail, yeah, they do video, whatever, but the primary driver of their profits is something called AWS, Amazon Web Services, and that's kind of what the internet runs on right now. It's like it's something that wasn't even part of the vision originally, and that's why the company succeeded. And so you can't really point to SpaceX and be like, oh, well, it's gonna be like this. They weren't profitable for a long time. It's like, yeah, the story changes all the time. Like, I just don't know if it makes sense to to get on pun intended here on this rocket ship and assume that you're gonna get massively positive returns from here because the valuation today is so ridiculous. All of these things have to come to fruition just for it to kind of meet that that valuation that we see today. Call me crazy. You do whatever you want when it comes to investing, but to me it's it it's interesting at most, destructive at worst.

SPEAKER_00 30:10

Yeah, and and in many ways, I mean, just if we go back to the the data over 100 years that dimensional put together, in this case, this is an interesting outlier because SpaceX rocketed again into those top 10 companies immediately. And so that it's it's kind of unprecedented from that respect. But what we've seen, the valuation in the years leading up, or that where that growth happens and that market capitalization goes up so quickly, that's where lots of the returns, the strong returns are received. And after that, it kind of tapers off and it becomes almost zero. And so it'll be interesting to see what the ride looks like. But based on some of this historic data, it suggests that maybe some of those returns might not come to fruition quickly. But again, it's about stories and it's about this amazing kind of attempt that the company is trying to pursue. So it remains to be seen.

SPEAKER_01 31:04

Yeah. Cool technology, interesting company, charismatic leader. You know, lots of polarizing opinions on the company and leadership there, of course. But anyways, it's another story that's kind of shaping things right now. Well, Sam, I didn't want to lead with this one, but you know, more speculative assets being in the in the news or you know, part of the story here, anyways. It's always going to be the case because speculation inherently just means that people are kind of guessing on what it's going to do next. And Bitcoin and gold, they're not really doing what I would have thought in this, you know, in this current economy and political climate and things like that. It's been a pretty brutal year for Bitcoin in particular, and gold just hasn't held up to the huge rise that we saw kind of through the end of last year and early parts of this year.

SPEAKER_00 31:55

Yeah, I think we did a podcast maybe in January about gold reaching its record high numbers. And part of our findings from our research around that is that gold is being approached as a hedge against uncertainty, it often is, but it hasn't reliably performed as such. We're kind of seeing that play out in relation to some of the conflict in the Middle East and oil prices being so high and things like you'd think you'd see gold price really shoot up, but we haven't seen that come to fruition. And in fact, it's come back down to Earth, as it were.

SPEAKER_01 32:26

Yeah, gold, I think, is as we sit here today. It's I think it's negative on the year actually now, just going back to January 1.

SPEAKER_00 32:34

Aaron Powell Yeah, that's right. It's down uh four percent since January 1st overall, after hitting, you know, it was up 25% by the middle of January, and uh that's in USD, but uh down about four percent as of taping today. Yeah, it's very interesting how that really plays out.

SPEAKER_01 32:51

And it's like, yeah, it's it's tough to predict the price of this thing because it's uh it's a non-productive asset that's used for hedging in some cases and profit taking, I guess, in others, right? Because if a price goes up and you can sell it, and boy, that's great. And who knows, maybe the gold miners flooded the market. I don't know, I'm not gonna speculate on where gold prices are coming and going from, but it has not shown, again, to be a reliable hedge against craziness, right? It might on like on the fringes or something like that, but again, reliably is kind of the main thing that we're thinking about when it comes to allocating our money and our clients' money. And it's just like the story's not there. It's possible, but it's like it's not reliable enough.

SPEAKER_00 33:35

Yeah, we're talking about reliability as we're trying to build investment philosophies and strategies. And if you if you can't reliably, based on the data, have a positive expected return, it's hard to want to include it meaningfully in any in any portfolio, you know.

SPEAKER_01 33:49

And then Bitcoin, again, is that that other piece. Like we we kind of started the year with some crazy stuff in Venezuela, you know, the country kind of getting toppled by the US. We haven't heard as much there anymore, but and then the war with Iran happening starting kind of at the end of February, I think it was. And you know, it's a pretty major Middle Eastern economy that you know that's that's had the source of their economic growth kind of strangled by uh the the conflict with the US. I'm not getting into the the politics of of all of it, but it's like with all of the the global challenges around the world, you'd think alternative currencies and things like that would offer some stability. And it's like no, like Bitcoin is absolutely getting blasted right now. Like this year, it's down again, as we record here, at 27%. And you know, many people think of it as a hedge against inflation, a hedge against monetary policy, geopolitical risk, government instability. Sorry, it like maybe maybe it does in some years, but it also hasn't been around long enough to have that repeatable track record in those different conditions, but also it it's a global speculative asset. It's like some people might think it does for their situation, other people's it doesn't for theirs. One would think, though, that this year would be one of those years where it would make some good sense. I don't know if people care enough about Bitcoin anymore, honestly. Like it's the the price is is driven by supply and demand. If the demand is there and people stop, you know, seeing it as something interesting enough to keep buying, the marginal transaction might be a sale, right? And so then it kind of drives the price back down. Again, not going to get into the plumbing mechanics of of cryptocurrencies here or anything like that, but you know, it's just year-to-date, it's down 27% and from its all-time high, quite a bit more than that, that's for sure.

SPEAKER_00 35:48

Yeah. So I mean, a similar story to gold in that way, where sometimes we view Bitcoin as a hedge. And in this case, and and as you're saying, there's been various destabilizing events that have really hit the news in the first six months of this year, but we've we haven't seen Bitcoin kind of shoot up if people were losing faith in other currencies. So again, just not something we're seeing as a reliable hedge against some of this uncertainty. And I guess, yeah, it feels, it can really feel uh in the news that these last few months have been really unique and there's been so much going on, and there really has been in lots of ways, but there's always uncertainty and volatility causing events and things like that, right? These are part and parcel with the market in lots of cases. So even though that's been top of mind, particularly in Canada and in North America, these have not been a hedge against some of those headlines and stories that we're seeing.

SPEAKER_01 36:35

Okay, so we can maybe wrap up with just kind of a quick summary of like what many typical investors might have experienced here. So coming up until the end of June, looking at one of those all equity portfolios, so like VEQT, we talked about that one already. Again, it's not a recommendation, it's just a really common one that's available to anybody to invest in. Year to date, it's up 14.28%. That is accurate as of June 30th here in 2026. But a more balanced investor, so not everything has to be all about equities. So V-Bal, so the same type of strategy, but incorporates 40% in bonds. It's also up 9.14% as of the end of June, which is crazy for a balanced portfolio. That's been a really, really strong performance for investors across the board. Now, for us here at Cedar Point, we Vanguard is part of some of our clients' portfolios, but in certain cases, we'll use some of those more factor-tilted portfolios as well. Dimensional is one of the providers that we use there. So their global equity portfolio, again, pretty equivalent allocations between them and Vanguard. It's up about 15.4% this year, and their 6040 balanced version is up 9.6%. So a little bit more stronger performance for that factor-tilted portfolio. And that makes good sense based on what we already talked about of value outperforming some small caps, especially in the international space. And for us as Canadian investors, I think we're much more likely to have that more globally diversified portfolio compared to our American counterparts who are much more likely to lean into a domestic heavy stock portfolio. So this has been a really strong year for investors so far. One word of caution I would suggest is that this too shall pass. You know, I'm not a doom and gloomer by any means, but these are returns that are much higher than you would typically expect. So for the back half of the year, if I'm I never make predictions or anything like that, but the market will come down at some point. It probably is not going to double or triple expectations every year. And so I would just say temper your expectations. Take the good when you can. Try not to get crazy with making changes and try to chase the next South Korea or the next gold or whatever the story is. You can stay with that globally diversified strategy. So that way you'll already own the part of the market that has tomorrow's return. Again, what we're trying to do with investing is get tomorrow's returns, not try to chase the returns that happened yesterday.

SPEAKER_00 39:04

Well, I think that's a perfect way to sum up our conversation today, Evan. And so all I will say is thank you everybody for listening. We'll catch you next week on the Canadian Money Roadmap. Take care.

SPEAKER_01 39:13

The contents of this podcast do not constitute an offer or solicitation for residents in the United States or any other jurisdiction where Evan Newfeld, Cedar Point Wealth, or Sterling Mutuals is not registered or permitted to conduct business. Mutual funds are provided through Sterling Mutuals Inc. Commissions, trailing commissions, management fees, and expenses all may be associated with mutual fund investments. Please read the prospectus carefully before investing. Mutual funds are not guaranteed, their values fluctuate frequently, and past performance may not be repeated. Financial planning services are provided by Evan Newfeld through Cedar Point Wealth and are not the business of or monitored by Sterling Mutuals.