Market Update April 2025
As we close out the first quarter of 2025, market headlines have once again created a sense of uncertainty.
Over the past few days alone, we’ve seen sharp declines. The Canadian market is now down approximately 11%, and U.S. markets are down close to 15% year-to-date.
And yet, despite the volatility, your portfolio has remained reasonably flat since January. This reflects the strength of our approach: one that emphasizes risk mitigation, consistent income, and long-term capital preservation. These remain the pillars of how we manage your wealth, especially in times like this.
We’ve spent the past several months carefully adjusting your portfolio in anticipation of volatility.
As a result, approximately 70% of your portfolio is now allocated to fixed income, cash, and gold. Your portfolio is currently generating an annual income of approximately 4.5%.
We’ve also trimmed equities, especially those vulnerable to global trade uncertainty, and added high-quality bonds and floating-rate bank loans for stability and diversification. This thoughtful positioning has helped you avoid the worst of the market’s decline while maintaining steady income - and flexibility to take advantage of opportunities when they arise.
If you’re taking income from your portfolio, it’s coming from the natural income being generated - not from selling assets in a down market. And if you’re not drawing income, it’s being reinvested to build strength, allowing us to position for future growth. This structure ensures we’re not reacting to short-term swings but building for long-term outcomes.
It’s normal to feel cautious in times like these.
But history shows that stepping to the sidelines often results in missed opportunities. Markets tend to recover quickly, and the best days often follow the worst. Selling in a downturn locks in losses and removes your ability to benefit from a rebound. Waiting for “certainty” usually means buying back in at higher prices. Volatility creates opportunity, and we’re positioned to take advantage when the time is right. Your portfolio is doing its job: protecting capital, generating income, and keeping you positioned to move forward.
The current pullback isn’t random. It’s part of a broader economic and political shift.
Over $9 trillion of U.S. government debt is maturing by June. The U.S. administration is using tariffs and global disruption to push interest rates lower ahead of refinancing. These tactics are creating short-term market panic—but with a longer-term goal: reducing borrowing costs, resetting trade terms, and shifting capital flows. This has created uncertainty worldwide, but also potential value as assets become more attractively priced.
As shown in the graph linked here: *20-Year Retrospective Outline, the markets have faced serious disruption before: the 2008 financial crisis, the 2015 commodity collapse, the 2020 COVID pandemic, and now, the 2025 tariff-driven reset.
In every case, investors who stayed invested and focused on fundamentals were rewarded over time. The same holds true today. This pullback, while uncomfortable, is laying the foundation for the next cycle of growth and, importantly, reinforces why a disciplined, long-term approach matters.
* 20-Year Retrospective Outline Graph Source: Dynamic Funds