Global markets closed a turbulent year on a positive note, despite year-end profit-taking. Every Vive investment category ended the quarter in positive territory. Emerging markets were once again the best-performing investment category.
Despite a turbulent year, many stock markets ended with stable price gains. Several important stock indices even ended near record or multi-year highs. This brought an optimistic end to a year that had previously been characterised by a lot of uncertainty.
A notable development in 2025 was that stock markets outside the United States performed better than the American market for the first time in several years. This was due, among other things, to the weakening of the US dollar, investors taking profits on large US technology companies by (partially) selling off their positions, and stocks outside the US being attractively priced at the beginning of 2025. This allowed positive developments outside the US to lead to higher stock prices more quickly.
In Europe, financial companies performed particularly well, helped by lower interest rate expectations. Although the European Central Bank left its policy rate unchanged in both October and December, it adjusted its growth forecast for 2026 upwards: from 1.2% to 1.4%. This gave investors extra confidence that the European economy is gradually recovering.
A positive sentiment emerged in global markets in the fourth quarter due to healthy corporate earnings growth, decreasing inflation, and the expectation that major central banks — led by the US central bank — will continue to have room for further interest rate cuts in 2026. Towards the end of the year, some investors took profits by selling off their positions, but the general sentiment remained positive.
For many emerging countries, which are highly dependent on exports to developed economies such as the US, this created more confidence. The South Korean stock exchange performed the best, partly thanks to a strong technology sector. The Chilean stock exchange benefited from rising commodity prices, as commodity exports constitute a large part of its market.
Although non-US stocks performed better than the US in 2025, the US stock market remains by far the largest in the world. To put this into perspective, we look at the MSCI All Country World Index Investable Market Index (MSCI ACWI IMI). This is a global equity index that covers nearly all publicly traded companies: from developed and emerging countries, and from large to small businesses.
The MSCI ACWI IMI covers approximately 99% of global market capitalisation. Companies with a higher market value count more heavily than smaller companies. When we look at this distribution as of 31 December 2025, we see that approximately 62.8% of the global market capitalisation is in US companies. This is followed by Japan (5.5%), the United Kingdom (3.3%) and Canada (3.1%). The United States therefore remains dominant, and one year of underperformance does not immediately change that.
At the same time, this development shows how important global diversification is. When returns are spread across multiple regions, you are less dependent on one country or sector. This leads to a more stable portfolio and helps to better manage risks, especially in a world where market leadership can shift. With a well-diversified and stable investment strategy, you benefit from opportunities wherever they arise.
That is why our advice remains unchanged: stick to your strategy.
Do not get carried away by temporary market movements or emotion. Stay focused on your personal financial goals. Only adjust your portfolio if your personal situation changes and not because of the whims of the market.
A broadly diversified, systematically managed strategy, such as Vive's, offers the best basis for long-term success. Trust the process and let your strategy work for you.