Uncommon Sense
December 2025 Newsletter
Welcome to the final newsletter of the year. It has been a genuine pleasure looking after you and your family once again, and I appreciate the continued trust you place in me.
It has been another rollercoaster of a year in markets and in life, and our main article this month digs into the biggest lessons we can take from it. There is always something new to learn, even for those of us who have been doing this for decades.
The festive season is now in full swing. You may have been lucky enough to secure the M&S Tom Kerridge Beef Wellington for a mere £195. If not, I am certain the usual mountain of festive food will do the trick and add a couple of pounds all the same. A small seasonal tip: Avoid the gym in early January, it is full of people trying to undo December in a single week.
Enjoy this month’s instalment of our newsletter. It is packed with ideas and links that you may find interesting. As always, we’re here if you’d like to discuss how any of these ideas might apply to your unique situation.
The Stock Markets
Inflation – The Real Enemy
📰 Read
The Bad Bargain: Why We Trade Our Dreams To Escape Our Nightmares [5 minutes]. What drives us to compromise our dreams in pursuit of comfort?
How To Have A Happy Retirement: 4 Secrets From Research [8 minutes]. Avoid the common pitfalls and embrace this new chapter with joy and purpose.
The Gifts We Give Our Kids [7 minutes]. Are you ready to give your kids the most valuable gifts that money can’t buy?
Everyone’s Leaving The Wrong Thing On The Table [2 minutes]. What are you prioritising?
What AI Companions Are Missing [3 minutes]. What if the AI companions that teens find so satisfying are actually missing a crucial element of true human connection?
9 Questions to Help Understand Life’s Greatest Mystery – You [8 minutes]. Nine thought-provoking questions.
🍿 Watch
🎧 Listen
Measure What Matters [1 minute]. Are you tracking the wrong metrics?
🖼️ A Picture is Worth a Thousand Words
The Brands That Gained the Most Value in 2025
The Global Cost of Living Index 2025
The Future of World Energy Supply
😀 Rational Optimism
The media is not a friend of the disciplined and patient investor. Ignoring the key determinants of lifetime investor returns, the media focuses on short-term returns, market predictions, and negative news.
We present the following as an antidote to the onslaught of negative news:
The First New Subsea Habitat in 40 Years Is About to Launch
In Senior Homes, AI Technology Is Sensing Falls Before They Happen
UK Neuralink Patient Uses Thought to Control Computer
2025 in Review
As we enter December, with one month still to go in 2025, there is already much for investors to reflect on.
The year began with the inauguration of President Trump, capping a year of elections that saw significant political change across the globe. What followed was a period of uncertainty and theatre around US tariffs that sent markets into a month of turbulence. Elsewhere, peace deals have begun to de-escalate conflicts that dominated headlines for years, while the AI revolution has continued to reshape industries and capture imaginations.
Despite periods of genuine chaos (including a sharp market decline that saw global equities fall by around -19%), it looks likely that 2025 will deliver another year of above-average returns for equity investors. This follows two excellent years of returns in 2023 and 2024.
We know from our conversations with clients that the period from March to April was an uncomfortable period for many. While these periods of decline and uncertainty are always unpleasant at the time, they remind us of the patience and discipline required to become successful long-term investors. The anxiety of early April has been rewarding for those who stayed invested.
While markets are forward-looking and already concerned about what 2026 could bring, there is value in pausing to look back. The events of the past year offer three lessons that can serve us well in the years ahead.
1 – Overvalued Markets Can Still Grow
At the start of this year, many commentators warned that global markets looked expensive by historical standards. Yet markets (a collection of the great companies and businesses of the world) have continued to deliver returns, reminding us once again that valuation tells us little about timing.
It can be tempting to wait for a better entry point or to reduce exposure to equity assets when prices seem stretched. But markets can remain expensive for years while still rewarding patient investors. Timing the market requires being right twice: when to get out and when to get back in. History suggests this is a game very few win (if any).
2 – Knowing What Will Happen Doesn’t Yell You How Markets Will React
The tariff announcements in early April provided a striking lesson in the limits of information.
On 2 April, the Liberation Day tariffs announcement confirmed what many had expected: sweeping tariffs were on the way. Markets, which had been declining in March, fell sharply as uncertainty took hold. Yet just a few days later, on 8 April, with uncertainty arguably at its peak and no clear resolution in sight, the market quietly found its bottom and began to recover.
Those who knew tariffs were coming had no advantage. The information was widely available. What nobody could know was how and when the market would respond. This is why we focus on planning rather than predicting.
3 – Long-Term Planning Beats Short-Term Prediction
It is rare for the world to undergo a shift as significant as the one we are living through with artificial intelligence. It is genuinely difficult to imagine what daily life will look like in five years, let alone how businesses, industries, and economies will adapt. However, we’re confident that the human ingenuity that has seen us adapt and prosper through previous technological revolutions will do so again.
The knock-on effects for financial markets are equally unknowable. And yet, this uncertainty is not new; it is the permanent condition of investing.
Fortunately, the long-term game we are playing is not the short-term game being reported on by financial media. A solid financial plan (an appropriate asset allocation, a margin of safety, and the discipline to stay invested through volatility) remains the foundation for long-term success. Let us resolve to hold onto this truth, especially when the future feels more uncertain than usual.
Thank you
In summary, 2025 has reinforced a timeless principle: we cannot predict, but we can prepare. These lessons, earned through a year of turbulence, will steady you when markets next test your resolve.
As we approach the end of another year, let us continue to focus on what we can control: maintaining robust financial plans and practising patient, disciplined investing.
We wish you a restful holiday season and hope the coming weeks bring time with the people who matter most. Whatever 2026 has in store, we will navigate it together.
We thank you for the opportunity to guide you and your family. It is a privilege to serve you, and we look forward to working with you for many more years.
We hope that you enjoyed this month’s newsletter. Please let us know what you enjoyed, or write back with any of your own news.
As always, we’re here for you.
See you next month,
Halcyon Financial Planning