12. December 2025 Zelos Ridgeline

We are pleased to share the December 2025 edition of the Zelos Ridgeline, our first update of the new year. As is customary, this edition reflects on how markets closed out 2025, highlights key contributors across the Zelos model portfolios, and outlines the themes shaping the investment landscape as we move into 2026. Markets Market Context: Strong Results, Uneven Leadership December saw a more cautious tone across global markets. In the U.S., major indices pulled back as investors digested bank earnings, inflation data, and shifting expectations for monetary policy. Gold and silver, meanwhile, surged to record highs as safe‑haven demand strengthened. Bond yields moved higher late in the month, pressuring fixed income returns. Despite the quieter finish, 2025 will be remembered as a strong but uneven year, marked by concentrated leadership in select equity segments and meaningful dispersion across regions and asset classes. These dynamics were front and centre in early-January conversations at Davos, where themes such as persistent geopolitical uncertainty, fiscal sustainability, and the longer-term implications of artificial intelligence and productivity dominated discussion. While near-term forecasts continue to shift, the consensus remains that volatility and dispersion are likely features, not bugs, of the investment landscape in 2026. Zelos Model Portfolio Update Against this backdrop, the Zelos model portfolios finished 2025 on solid footing. As at December 31, 2025, one-year returns ranged from approximately 6.7% to 10.7%, depending on mandate. More importantly, these results were delivered with meaningfully lower volatility than broad equity markets, reinforcing our core objective: to compound capital over full market cycles while managing downside risk. As we approach seven years of track record in early 2026, we believe this disciplined, diversified approach continues to differentiate Zelos in an environment where headline index returns often mask underlying risk. This track record stands the test of time and has shown resilience in drawdown periods like COVID-19 and 2022. Looking Ahead to 2026 As we look ahead to 2026, one theme continues to stand out across global markets: the scale and momentum of investment into artificial intelligence. Capital spending on AI, ranging from cloud infrastructure to semiconductors to data‑driven enterprise systems, has become large enough to meaningfully influence economic activity and market leadership. While technology companies remain at the forefront, the ripple effects are expected to extend across supply chains, industrials, energy, and a wide range of ancillary sectors positioned to support or benefit from this expansion. Importantly, the economic payoff from this investment cycle will unfold gradually. Many companies may rely on both public and private credit markets to fund capacity growth, creating selective opportunities for investors across the capital structure. In an environment where a small number of powerful themes can have an outsized influence on outcomes, thoughtful portfolio construction and disciplined positioning are increasingly important. We continue to actively monitor our recommended asset mixes and will make adjustments where we believe they can enhance diversification, manage risk, and improve long-term outcomes for our clients. #ZelosRidgeline #marketupdate #longterminvesting #wealthmanagement