Stock Market Commentary January 2026
As 2025 comes to a close, we want to say thank you for another year with us. We are happy with the returns of our portfolios on a risk-adjusted basis. If you'd like to discuss your individual performance, please let us know because we always enjoy review meetings and touching base with you.
If you'd like to go over what you're in now, and what other opportunities may be available, please reach out to us to discuss how we might be able to further adjust your risk tolerance to your investment portfolio.
As an independent firm, we believe we have a lot to offer and different opportunities you may want to consider.
The stock market has been positive for 3 years in a row (1). In our experience, this is normally when people start to get overconfident (and sometimes even greedy) and move to portfolios that are above their normal risk tolerance.
If you increase risk and the market goes up, there is a chance you'll earn more. If you increase risk and the stock market falls, there is a chance your account may have a loss or experience more volatility.
Actively Managed Portfolios for Steady Returns
Many of our clients are invested in our Actively Managed portfolios. Please call us if you're not sure which type of portfolio you're in. Our Actively Managed portfolios are based upon one primary goal: Generating Steady Returns.
One strategy that we may use if it appears that the market is going to drop quickly, is to execute changes with the goal of trying to minimize any potential losses.
For retirees and those approaching retirement, knowing that we are monitoring and updating the portfolios frequently based upon our research tools may provide some financial peace of mind.
However, for younger or higher risk investors, our risk managed portfolios might not be as good of a fit as they are generally comfortable with more volatility in their portfolios or aren't concerned about a down year or two for the stock market.
2026 Stock Market Outlook: Potential Volatility Ahead
We're sharing all of this because we have a number of indicators that have us believing that the stock market may have a volatile year in 2026 or 2027.
We believe 2026 will be a positive year overall, but it could potentially be rockier than the past few years.
If 2026 doesn't bring a significant drop, then we think that the probability of a bigger drop in 2027 increases.
The Federal Reserve has been cutting interest rates, which has the potential to be a tailwind for the economy and stock market in our opinion (2).
Also, it's a mid-term election year, so there is a chance the Republicans will aim to "window dress" the economy and stock market in the hopes of getting re-elected.
These are two of the factors that tilt us towards predicting a positive year for 2026, but anything is possible and we'll continue to keep you updated.
Santa Claus Rally and January Market Indicators
While past performance cannot predict future performance, we will be monitoring how the first week of January and January as a whole goes because there is some data that shows a weak "Santa Claus Rally" or weak January has been predictive in the past for how the first half of a calendar year may go (3).
Schedule Your Portfolio Review Meeting
There is a lot going on in the world and it's a great time to touch base.
If we haven't spoken in a while and you would like to go over your numbers, or you've had any changes to your family, finances, employer/job, or risk tolerance, please contact us at (586) 226-2100 to schedule a review meeting.
We would love to meet with you over the phone, Zoom, or face to face to strategize.
Sincerely,
Ken Wink
with contributions by Robert Wink, James Wink, Zachary Bachner, CFP® and James Baldwin
Notes & Disclaimer
Investment advisory services are offered through Summit Financial Consulting LLC, an SEC registered investment advisory firm. Summit Financial Consulting Investment Advisory Firm Representatives do not render tax, legal, or accounting advice. Life/Annuity Insurance products and services offered by the individual insurance agent. Health insurance is offered through Summit Health Services, LLC and Property/Casualty (P&C) Insurance is offered through Summit Insurance Services, LLC and our local P&C agency partners. Please update Summit Financial Consulting LLC if your investment objectives have changed or if the personal or financial information previously provided has changed. Past performance is no guarantee of future results. Representatives of Summit Financial Consulting LLC offer tax preparation services through Summit Tax Services. Summit Tax Services is a DBA of Heemer Klein & Company and they are owned and operated independently.
Ken Wink
Kenneth “Ken” Wink is the Co-Founder and Chief Compliance Officer of Summit Financial Consulting, LLC. With over 22 years of experience in the financial services industry, he is deeply knowledgeable and passionate about explaining complex financial concepts in understandable terms. Ken’s passion for simplifying complex financial concepts began early. While still in high school, he honed his skills by assisting classmates with their tax returns. This led him to pursue a B.A. in Finance at Michigan State University, graduating with honors. He further bolstered his qualifications by obtaining numerous financial licenses, including Series 6, 7, 63, and 65, along with Life, Health, and Accident licenses. Ken believes that everyone deserves to make informed financial decisions without feeling overwhelmed or intimidated. That’s why he writes articles that break down complex concepts into understandable terms, empowering you to navigate your financial future with confidence.