Founder of hedge fund Bridgewater Associates, Ray Dalio, in a recent post on social media, reflected back upon the top trends which shaped the global market in the year 2025, as the billionaire investor now focuses on the global macroeconomic picture.
Market veteran with more than five decades of experience, Ray Dalio is also the Chief Investment Officer (CIO) mentor and a board member at Bridgewater Associates. Dalio holds an MBA degree from the Harvard Business School, Boston, Massachusetts.
Top trends that shaped global markets in 2025
1. Fading dollar value: The US dollar lost its value against the Japanese Yen, the Euro, the Swiss franc, and the precious yellow metal gold, explained Ray Dalio amid the global economic uncertainties.
Dalio said that the US dollar lost 0.3% against the Japanese Yen, 4% against the renminbi (Chinese Yuan), 12% of its value against the Euro, and 13% value against the Swiss franc.
He also highlighted how the US dollar fell by 39% against precious metal gold, which is also the second-largest reserve currency in the world and the only major non-fiat currency.
“So, all fiat currencies fell, and the biggest story and the biggest market moves of the year were the result of the weakest fiat currencies falling the most, while the strongest/hardest currencies strengthened the most,” said Dalio in his post on X.
2. Best investment of 2025: The billionaire investors explained that the best major investment for the year 2025 was holding a long position in gold, as the commodity delivered investors 65% returns on their investment in the period.
Gold “outperformed the S&P index (which returned 18% in dollars) by 47%. Or, said differently, the S&P fell by 28% in gold-money terms,” said Ray Dalio.
3. Investment returns: The hedge fund founder highlighted that in the case of when a nation’s currency drops, then the things measured in it go up. Hence, when people look at the returns on investment through a weaker currency then the gains look higher.
Dalio cited how the S&P 500 gave dollar-based investors 18% returns on their investment, while 17% to the yen-based investors, 13% to the renminbi-based investors, 4% to the euro-based investors, and 3% to the Swiss franc-based investors.
However, in the case of gold-based investors, the S&P 500 lost 28% in 2025.
“When one’s own currency goes down, it makes it look like the things measured in it went up. In other words, looking at the investment returns through the lens of a weak currency makes them look stronger than they really are,” said Dalio.
4. US stock underperformance: Ray Dalio said that the US stocks underperformed against the non-US stocks and precious metal gold in 2025 as the assets were strong in dollar terms but comparatively weaker in other currencies.
“Clearly, investors would have much rather been in non-US stocks than in US stocks, just as they would have preferred to be in non-US bonds than in US bonds and US cash,” said the billionaire investor.
Dalio cited that the Euro stocks outperformed US stocks by 23%, while the Chinese stocks outperformed by 21%, the UK stocks outperformed by 19%, and the Japanese stocks outperformed by 10% due to the shift in flows, values, and, in turn, wealth away from the United States.
5. Productivity growth in 2026: Ray Dalio expects the productivity in the United States to likely improve in the year 2026. However, the uncertainty still looms over how much it will improve and how much of it will be allowed to flow through to impact company profits and stock prices in the US market.
“It appears most likely that the newly appointed Fed chair and the FOMC will be biased to push nominal and real interest rates down, which would be supportive to prices and inflate bubbles. As for productivity growth, it will likely improve in 2026,” he said.
6. The political order: Dalio cited the Donald Trump administration’s domestic policy, the US foreign policy, and the increasing income and wealth gaps as the reasons behind the interdependence of the markets and the political order in the country.
“Because markets and the economy affect politics and politics affect markets and the economy, politics played a big role in driving markets and economies,” said Ray Dalio.
The billionaire said that the value of money issue, which is also known as the affordability issue, is likely to be the biggest political issue in the next year.
“The value of money issue, otherwise known as the affordability issue, will probably be the number one political issue next year, contributing to the Republicans losing the House and a very messy 2027 on the way to a very interesting 2028 election in which the clash between the right and the left is shaping up to be a big one,” he said.
Read all stories by Anubhav Mukherjee
Disclaimer: This story is for educational purposes only. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.
