Lessons from Conversations and Life
- By Pedro Ribeiro, Founder, CEO, and Portfolio Manager
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Dear Valued Clients,
New Year’s resolutions are a common practice for many of us. Whether driven by psychological, cultural, or personal reasons, they are often tied to the symbolic fresh start that people associate with the beginning of a new year.
Personally, I am not one for resolutions. Instead, I prefer to reflect on the past year. During this annual ritual, I often find myself looking back not only over the past year but over several previous years as well.
This time of reflection allows me to consider the decisions that went right, as well as those that resulted in less favorable outcomes. Ultimately, these reflections aim to help us grow and improve as individuals across many dimensions.
It is also a time when I replay conversations I’ve had with family, friends, clients, and even strangers whom I will never see again. Conversations are often how we learn from one another. By sharing personal experiences and knowledge, we gain wisdom and new perspectives.
Over the years, I have met and spoken with people from all walks and stages of life. This includes blue-collar and white-collar workers, assembly-line employees, CEOs and founders of very successful companies, those drowning in debt, and families with tremendous wealth. Some of the most meaningful conversations were with individuals from different cultures and nationalities who shared both common and—more importantly—differing perspectives on a range of topics.
What stood out from last year’s interactions was how much time people spend worrying about things they have no control over. The more I thought about it, the clearer it became—this has been true for as long as I can remember. It’s nothing new.
Why do so many people rent out their minds for free to worries beyond their reach?
From these diverse conversations, it also became evident that those who worry less about what they can’t control—and instead focus on their own actions, family, and friends—tend to be happier, less stressed, and even healthier.
While I won’t be making a New Year’s resolution this year, I hope I’ve grown a bit wiser. I will continue to focus my time and energy on what I can control: the relationships and resources I dedicate to family, friends, and our valued clients.
This perspective feels timeless, echoing ancient wisdom about distinguishing what is in our power from what isn’t. Perhaps it’s age, the addition of grandchildren, or lessons learned from those wiser that have shifted my views. Either way, these reflections remind me that true growth comes not from rigid resolutions, but from mindful attention to what truly matters to each one of us.
Pitfalls of Forecasting: Why Predictions Often Miss the Mark
Forecasting or attempting to predict a “point-in-time value” for the S&P 500 index (or any other major index) over a short-term 12-month horizon is, in my opinion, a pointless use of time and energy—and a great example of something most investors have no control over.
While global banks and investment houses eagerly release precise targets for the last trading day of the new year, the reality is that these year-end prognostications were originally introduced to attract attention and generate conversations with clients that could translate into revenue-producing transactions.
A study by CXO Advisory Group of 6,584 forecasts from 68 experts between 2005 and 2012 found an average accuracy rate of just under 47%—worse than a coin flip. These so-called experts included notable names such as Jeremy Grantham, Mark Faber, Gary Shilling, and Abby Joseph Cohen. Many of these same individuals, despite their weak forecasting track record, were given airtime to broadcast their views on popular financial news outlets such as CNBC and MSNBC.
The same era of analysis showed that Wall Street analysts missed S&P 500 forecasts in most years, often by significant margins. Among the better performers were David Dreman (70%), Louis Navellier (66%), Bob Doll (60%), and John Buckingham (79%). If you don’t recognize these individuals, don’t be surprised—they have not made many (if any) public appearances on national media outlets in recent years.
In the latest Big Picture article published by Nadeem Kassam, MBA, CFA, Chief Investment Strategist—“Market Outlook for 2026: Half Full or Half Empty? It Depends”—Nadeem too avoids spending valuable time and energy on making short-term predictions for year-end values of the major indexes.
Rather, Nadeem formulates a narrative on the outlook for markets and substantiates these short-, medium-, and long-term views using extensive data. On this note, while the “wall of worries” continues to grow for some investors, Nadeem remains constructively positive for the next several years, but also cognizant that—while there are many known risks today—there are likely other unknown risks that may manifest in 2026 (click here to watch Nadeem’s recent appearance on BNN Bloomberg). One could argue that the recent events between the United States and Venezuela are an example of an unknown risk that has emerged only a few days into the new year.
Nadeem goes on to write, “while we expect new risks to emerge that will add to and rattle markets and investor confidence, we plan to be ready to deploy capital at times when investor emotion takes over, forcing them to sell great investments at the worst possible moment (e.g., selling low, buying high).”
Turning Volatility into Opportunity: A Disciplined 2025
April 2, 2025—known as Liberation Day—is when President Trump announced tariffs on just about every country. The S&P 500 index dropped 5% on April 3 and went on to fall by over 10% within the next four days. Some companies dropped between 20% and 50%.
The Marnoa Quality Compounders Private Pool launched on May 1, 2025. It ended the year with a positive return of just under 14%.
Our overweight cash levels were a function of us being more cautious given the uncertainty around tariffs. The strong rally that followed the Liberation Day tariffs, along with our gradual allocation of capital, reflected our decision not to chase but to prudently allocate your capital with a long-term mindset and high due diligence process.
We allocate for the long term, and at times, our performance will not ebb and flow to the same degree as the markets, but we have a high degree of confidence in our top-down and bottom-up investment process that it will add value for our clients on a risk-adjusted basis over the long-term.
This is what we refer to as the investment experience—smooth and consistent over the long term.
We were able to add Robinhood (HOOD) as a new position. HOOD, like many other stocks, dropped significantly during this volatile period. Understanding the business and believing in its long-term opportunity, we started buying shares during the market pullback. Since then, HOOD has been our top performer, up over 100% from purchase to year-end.
We also saw this with Tesla—when criticism of Elon Musk was at its peak, the stock subsequently climbed to all-time highs by late December.
We added to our position in Alphabet (the parent company of Google) in May at a price just below $172, when analysts and news pundits were writing it off because of competition from ChatGPT and other AI startups. Alphabet closed at $321.98 on January 7, 2026. Not all our investments generated great results.
We were down on the year in our Netflix shares, but we remain constructive on the company’s outlook. During December’s tax-loss selling window, we strategically realized our unrealized losses to offset future capital gains while preserving meaningful indirect exposure through an appropriate ETF. This approach ensured we remained well-positioned to benefit from any upside. We intend to re-establish a direct position once we have passed the superficial loss period.
Although some holdings such as RBC, Brookfield, and Suncor each generated returns of over 25%, our overweight CAD cash and underweight resources position was responsible for the weaker performance in the Canadian allocation. The S&P/TSX’s strong full-year outperformance can be attributed largely to resources, with gold shining and propelling the index to all-time highs.
As we turn the page to a new year, I am genuinely excited about the opportunities ahead for Marnoa and, more importantly, for you – our valued clients and investors. Our team remains steadfast in our commitment to delivering personalized strategies that align with your unique goals, navigating market dynamics may arise.
Please know that my door – and that of our entire team – is always open. Whether you have questions, ideas or simply wish to discuss your vision for the future, do not hesitate to reach out. Together we will continue to build lasting wealth and prosperity.
Sincerely,
Pedro Ribeiro, CIM, FCSI
Founder, CEO and Portfolio Manager
Marnoa Private Wealth Counsel
pedro.ribeiro@marnoa.ca