Picture a man named Gord. He is not a real person, but he is not far from a few I have known.
Gord grew apples outside Kelowna. In 2018 he sold twenty acres to a neighbour who wanted to plant grapes, and for the first time in his life he had real money that was not in the ground. He knew what it was for. A few more good years on the orchard, then a retirement that did not depend on the weather, and something left over for the grandkids.
He took the money to an advisor he trusted, and they spent an afternoon on the only questions that mattered. What does this money have to do, and when? How much of a fall could he sit through without losing sleep? By the end of it they had a plan: a portfolio of established businesses, sized to what Gord needed and how long he had.
Gord wanted to wait. The American midterms were coming on 6 November, the tariff fight with China was on the front page every morning, and once he knew who controlled Congress, he told himself, he would know what to do. His advisor did not argue. She asked him what he thought would happen. He said the Democrats would take the House and the Republicans would keep the Senate.
He was exactly right. The plan went in the week after the vote.
By Christmas Eve his account was down about thirteen percent.
Nothing in the election had done it. The Federal Reserve raised rates in December, the tariff fight dragged on, and the American government shut down three days before Christmas. On Christmas Eve, Gord sat at the kitchen table with his statement and picked up the phone.
He wanted out. He had waited all autumn for clarity, called the result perfectly, and lost money anyway. It felt like proof that he should never have gone in.
His advisor let him say all of it. Then she asked him the same questions they had started with. Had his retirement date changed? No. Did he need this money in the next year, or the next five? No. Had anything happened to the businesses he owned? The railway was still moving grain. The grocer was still selling milk. The bank was still collecting on its mortgages.
Gord knew that kind of answer. He had been through bad prices and a hard spring frost, and he knew the difference between a bad season and a bad tree. When he looked at what he owned through that lens, the trees were fine. Only the prices had changed.
He hung up and did nothing. That was the hardest decision he made all year, and the best one.
What the Calendar Cannot Tell You
Gord's call on the election was perfect, and it did not matter in either direction. The fall came from things no ballot decided, and the recovery that followed in 2019 had nothing to do with Congress either.
For a Canadian, that is truer still. Toronto is built on banks, energy and mining, and it answers to interest rates and the price of a barrel far more than to Washington. In three of the last four midterms, the Canadian market ended the following year lower even as the American one rose. Calling the election correctly would not have told you that, because the election was never what moved it.
This year the vote handed Democrats both the House and the Senate, and markets in New York and Toronto rose the next day. Gord would recognize the feeling. So would his advisor, who would point out that the coming weeks will bring their own weather: tariffs, a Federal Reserve that may raise rates in December, a Bank of Canada that raised its own rate in October, and an oil price set by a strait on the other side of the world. None of that is on the electoral calendar.
How We Approach It
Market movements are noise. They are loud, they arrive daily, and on any given day they say almost nothing about whether a retirement, a business sale or a family's future is on track. A plan is measured against its purpose: what the money has to do, and when. A bad December does not move a retirement date.
The portfolios I manage own businesses, chosen for what they earn and how that grows, sized to the client, and reviewed on purpose while they are working. When markets fall, my first job is the one Gord's advisor did on Christmas Eve. Go back to the goal, check whether anything that matters has changed, and if it has not, leave the plan alone.
Over a lifetime, the investors who get ahead tend to be the ones who stay invested with the end in mind. Calling the election rarely has much to do with it. Having a plan, and keeping it when it is hardest to, usually does.
Forward With Purpose.
Ross Sikora