The 2026 investing outlook presented here argues that several major market themes from 2025 may continue, but with a different distribution of returns. The central view is that U.S. mega-cap technology and AI-related enthusiasm may be closer to exhaustion, while currencies, metals, miners, selected international equities, Bitcoin, and specific quality businesses may offer more interesting opportunities.
The investor’s stock portfolio ended the previous year up a little over 30%, outperforming the market and exceeding the stated target, though it had been up about 50% earlier in the year. The main lessons from the year were not only about bad trades, but about missed opportunities. Gold and German defense contractors were described as obvious early-2025 themes that performed well, but were not acted on.
Another missed opportunity came in mid-December 2024, after the U.S. election, when market sentiment around “American exceptionalism” and the U.S. dollar looked euphoric. The conclusion was that the market was overextended, but the portfolio was not fully sold before the tariff-related downturn.
Currency Positioning
The investor had held mostly U.S. dollar-denominated assets for several years because the dollar had been in a bull market. By late 2024, the view shifted: the U.S. dollar trade looked overextended, and a longer period of weakness seemed possible.
Rather than directly speculating on currencies, the preferred approach was to buy quality assets denominated in other currencies. The reasoning is that if the currency call is wrong, the underlying quality asset may still reduce the downside.
The largest currency hedge was through Canadian dollar-denominated assets. The exchange was made at around 1.44 CAD per USD, and the year ended near 1.37, producing about a 5% lift in U.S. dollar terms on those holdings.
The outlook for 2026 is that the Canadian dollar may strengthen further against the U.S. dollar, potentially below 1.36 CAD per USD by year-end.
Three main reasons are given:
- U.S. interest rates face downward pressure.
- The Bank of Canada may move in the opposite direction or keep relatively tighter conditions.
- Higher metals prices may bring more money into Canada’s resource-heavy economy.
The same logic may also support currencies tied to mining-heavy economies, including Australia. South Africa is mentioned as mineral-rich, but with other problems that make the currency case less straightforward.
Metals and Resource Economies
Metals were a major theme in 2025. Gold performed well first, followed by silver, platinum, palladium, copper, and other metals.
The view for 2026 is not necessarily that gold, silver, or copper will produce spectacular new gains, but that prices may remain elevated. This matters because mining companies can see much higher margins when commodity prices rise while operating costs remain relatively stable.
The key metals highlighted are:
- Silver, supported by shortages and solar panel demand.
- Copper, supported by electrification and infrastructure demand.
- Gold, as part of the broader precious-metals strength.
If high prices persist, miners may expand production. This could benefit mining-heavy countries and regions, including:
- Canada
- Australia
- Chile
- Peru
- Mexico
Chile and Peru are highlighted because relatively small amounts of capital can have a meaningful effect in smaller economies. Mexico is also noted as having some of the world’s largest silver mines, though its larger economy means the effect is proportionally smaller.
The outlook also suggests that companies supplying mining expansion, such as equipment manufacturers, may benefit. Caterpillar is cited as an example of a company already helped by this theme.
Copper and silver miners are described as potentially interesting long-term opportunities if quality names can be found.
Tariffs and Canada
A key 2026 macro expectation is that Trump-era tariffs may be overturned by the Supreme Court. If that happens, the effect could be stimulative because hundreds of billions of dollars in collected tariffs may need to be refunded.
This would likely help Canada because tariffs have hurt trade between Canada and the United States. Lower tariff pressure could mean more money flowing into Canada to buy goods and services.
Steel and cement are used as examples. U.S. prices are described as much higher than Chinese prices, in some cases around three times higher. This creates opportunities for Canadian producers to export into the U.S. if price gaps remain attractive.
S&P 500 Outlook
The S&P 500 is expected to perform worse in 2026 than it did over the previous three years. This is not presented as a firm prediction that the index will fall, but as a view that returns are likely to be weaker.
The main reasons are:
- The index has already had three strong consecutive years.
- The S&P 500 is highly concentrated in a few large companies.
- Mega-cap technology and AI-related names may have already absorbed much of the enthusiasm.
- If the largest companies stop rising strongly, the rest of the index must perform unusually well to lift the whole market.
Companies mentioned in this context include Nvidia, Microsoft, Apple, and Google. These are described as high-quality companies, but ones that have already run up significantly.
The AI infrastructure buildout may also create near-term pressure because major capital expenditure does not always produce immediate returns.
AI Valuations
The view is that AI as a technology will continue to matter, but the valuation cycle may have peaked.
The concern is not that AI disappears, but that private and public valuations have become stretched. Examples mentioned include:
- OpenAI raising at around $500 billion
- Anthropic reportedly raising above $300 billion
- Thinking Machines reportedly raising around $40 billion
The concern is that these valuations may be difficult to justify, even if revenue is growing quickly. OpenAI is described as having reached around $20 billion in annual revenue, but the valuation may still be too high relative to fundamentals.
There is also concern about circular financing, where companies invest in each other and then use the money to buy chips, data center capacity, or related services.
The conclusion is that AI adoption can continue while AI-related valuations still compress or stagnate.
Interest Rates, Oil, and Inflation
The outlook groups U.S. interest rates, oil prices, and inflation together as areas where large changes are not expected.
The view is:
- Short-term U.S. rates may be lower by the end of 2026.
- Long-term rates are harder to predict.
- Oil may move somewhat higher or lower, but probably not dramatically.
- Inflation may move somewhat higher or lower, but probably not dramatically.
This is framed as a year where some macro variables may remain broadly range-bound rather than producing major surprises.
Portfolio Winners
Several successful positions are discussed.
SK Hynix was one of the strongest individual performers. The company produces high-bandwidth memory, which is needed for AI data centers. It was bought at around 4x forward earnings, which was viewed as extremely cheap. The position rose close to 200%.
The long-term concern is that high-bandwidth memory shortages will not last forever. As supply increases, margins may fall, so this is not necessarily viewed as a permanent compounder.
ASML was bought as a euro-denominated quality asset. It is described as close to a monopoly in advanced lithography. The position rose about 40% for the year and remains a long-term holding, though China’s lithography development is noted as a future competitive concern.
Pershing Square was bought at about a 35% discount to asset value. The thesis was that Bill Ackman could potentially compound at around 20% per year over time. The position rose about 40%.
Tesla was bought on the simple thesis that one of the strongest entrepreneurs of the era may outperform the S&P 500. The position performed well, but the mistake was sizing it too small.
Coinbase was bought under a “gambling thesis”: as complexity and uncertainty rise, people gamble more, and the best position is to own the house. Crypto is described as largely millennial gambling, with Coinbase as the available public-market way to own the exchange layer.
Futu was bought as an “Asian Robinhood” style platform and performed well. The same gambling thesis is still considered active.
Shopify performed very well and remains a holding, though it is now considered expensive.
MercadoLibre is described as an extremely high-quality Latin American compounder. The position doubled, and the investor may increase it further.
NuBank was added as a Brazilian banking platform with a major cost advantage. It is compared loosely to Revolut and is expanding into markets including Mexico.
Portfolio Mistakes
Several losing or problematic positions are discussed.
Teladoc was described as the worst investment. The mistake was misunderstanding the competitive landscape. Telehealth had fewer barriers to entry than expected, and the company lacked founder-led alignment.
eXp Realty was bought with the mistaken view that it could return to previous all-time highs. Later analysis suggested the growth required to justify that outcome was unrealistic. The mistake was also not exiting earlier after the thesis weakened.
JD.com remains profitable but is viewed as a position that should probably be sold.
Super Micro was bought after a decline, based on the idea that it had an advantage in liquid cooling and data center infrastructure. That advantage now looks weaker than expected because customers could shift to competitors such as Dell.
Etsy was bought partly on a share-buyback thesis. The market cap was low enough and buybacks large enough that the share price could benefit. However, the company itself is not viewed as especially high quality, so it may not be a long-term holding.
The planned exits are:
- JD.com
- Super Micro
- Etsy
China Positions
Several Chinese stocks were bought after the Chinese market had been heavily beaten down.
Alibaba was exited with a 100% gain.
Tencent remains a long-term holding because it is viewed as a quality compounder.
Several Chinese fintech positions performed extremely well, with some rising more than 500%, though the position sizes were too small. The later pullback was attributed partly to Chinese regulatory changes. Despite the risk, the positions were increased slightly because they remain cheap, founder-led, dividend-paying, and potentially attractive compared with holding cash.
Gaming and Unity
Unity was bought as a way to invest in the gaming industry without betting on specific game titles. The thesis is that more studios will rely on external engines over time rather than building their own.
The concern is that Unity competes with Unreal Engine, owned by Epic Games, and Tim Sweeney is viewed as a strong competitor. Unity’s previous CEO is criticized, especially because of dilution from share-based compensation.
The position is now up about 50%, but it has been volatile and requires monitoring.
Japan and Yen Exposure
A small yen-denominated position was added through ticker 4475. The purpose was partly currency diversification into a quality Japanese asset. The company initially performed well, then pulled back. The position remains small and is being used to study the company further.
Private Investments and Lending
Outside public stocks, the portfolio includes private businesses, real estate investments, and hard money lending.
Hard money lending performed especially well, reportedly producing around 34.3% annually on certain deals. This is not expected to repeat consistently.
Main Risks
The major risks discussed include:
- Yen carry trade unwinding
- Rapid U.S. dollar decline
- Commodity price spikes causing inflation pressure
- War or major geopolitical shocks
- Pandemic-style shock events
- AI valuation compression
- China regulatory risk
- Overconfidence and poor position sizing
Debt issues are acknowledged as a long-term concern, but not seen as an immediate major threat.
Bitcoin Outlook
The market is described as highly bearish on Bitcoin, with many people expecting 2026 to be a major down year because of the traditional four-year cycle.
The view here is contrarian: the four-year Bitcoin cycle may break.
Bitcoin around $80,000 is described as having a better risk-reward profile for buying. The investor does not rule out a move lower, such as toward $74,000, but believes the risk-reward shifted favorably around $80,000.
The long-term view is that Bitcoin could reach $800,000 to $1 million over a much longer period, such as 10, 15, or 20 years, but not necessarily within the next four years.
Bitcoin is described less as a utility asset and more as a religion-like asset with a strong unpaid marketing machine. The point is not that Bitcoin will make everyone rich, but that its committed community may continue to support long-term adoption and price appreciation.
The view is that many sellers may already have sold, fear levels are unusually high, and people expecting a deep 2026 bear market may miss a recovery.
Potential short-term catalysts could appear before summer, with enthusiasm possibly returning by February, though the outcome is uncertain.
Practical Takeaway
The 2026 outlook is cautious on U.S. mega-cap technology and AI valuations, constructive on selected currencies and resource-linked economies, positive on sustained copper and silver demand, selective on quality international equities, and contrarian on Bitcoin.
The key investing lessons are to avoid overconfidence, size strong ideas properly, cut broken theses earlier, focus on quality assets, and look for broad themes where multiple pressures point in the same direction.
