This year has been a wild ride for the stock market. From tariffs and the Trade War to federal rate cuts and the rise of AI, many investors have seen their shares plunge, rebound and soar in months. And there’s still another quarter to go before the year draws to a close.
How are Canadian investors reacting to the market’s ebbs and flows? Are they holding tight to the strategies of yesteryear, or are they following a new playbook for growing their money? Finder.com dives into this year’s investment data to find out.
It seems the stock market has rebounded from the post-tariff slump, with the S&P/TSX Composite returning around 20% year-to-date (YTD), outpacing its American counterpart, the S&P 500, by about 7%.
For context, the S&P/TSX Composite yielded more than 21% last year, ahead of the prior year’s return of nearly 12%.
Technology and financials were the main powerhouses behind 2024’s market surge and are on track to perform solidly in 2025 as well.
This year, however, the materials sector is turning out to be the real winner, driven by increased demand for gold, which some experts consider to be a “fear commodity” in light of its appeal during economically uncertain times (more on gold below).
ETF investments are up year-over-year (YoY), while mutual fund investments are down, according to a July report from the Securities and Investment Management Association (SIMA). Lower fees and greater tax advantages may play a role in the heightened popularity of ETFs.
Positive stock market returns can mean a number of things, one of which is that investors are pouring more money into stocks, driving up prices and the overall value of the market. Some Canadians may have viewed the tumult of Q1 and Q2 as an opportunity to “buy the dip.”
Private equity skyrocketed in the first half of 2025
Canadians are also pouring into private equity, which has experienced a record-breaking inflow of dollars, according to the Canadian Venture Capital Association (CVCA).
In fact, the amount invested in the first half (H1) of this year has already exceeded the total amount invested in 2024, with $30.85 billion poured into 322 deals so far, compared to $27.5 billion invested throughout all of last year.
The largest number of deals (95) were inked by industrial and manufacturing companies, while automotive and transportation companies brought in the highest amount of money ($3.4 billion), thanks to several high-value deals.
Canadian investors haven’t exactly shied away from equity in 2025, but neither have they ignored the need to offset risk with considerably safer fixed-income instruments like bond funds and government-issued securities.
Bond mutual funds are by far outpacing equity mutual funds this year, with SIMA reporting net sales of $17.4 billion YTD for the former and net redemptions of $6.6 billion YTD for the latter.
That means investors are selling off equity mutual funds and buying up bond funds.
Bond ETFs are also showing strong net sales YTD ($15.5 billion), although not as strong as equity ETFs ($34.3 billion).
Government-issued securities tend to look like a safe haven when investors are worried. Year-over-year trading is up for federal Crown corporation bonds (24%), Government of Canada bonds (14%) and provincial bonds (13%), the Canadian Investment Regulatory Organization (CIRO) reports.
Corporate bond trading, on the other hand, is down 6% YoY.
Another appealing option for the risk-averse, money-market instruments have similarly grown in popularity. Overall trading is up 14% YoY, aided substantially by a 30% YoY jump in Government of Canada T-bills trading, according to CIRO.
Furthermore, SIMA reports that sales of money market mutual funds and ETFs have increased in Canada this year.
In the Finder Consumer Sentiment Survey January 2025, Canadians ranked Guaranteed Investment Certificates (GICs) as the third most appealing type of investment to make in 2025 (37%), behind mutual funds (40%) and stocks (51%).
Bonds and money market funds ranked lower on the list, at 22% and 16% respectively.
Though not the most eye-catching part of the average investor’s portfolio, it’s clear that fixed-income securities remain an important tool for mitigating risk during economic turbulence.
Market upheaval can send investors nervously (or bravely) travelling off the beaten path for ways to preserve and grow their wealth.
Such is the case in 2025, which has seen a renewal of interest in both old and new types of assets, namely, gold and cryptocurrency.
A gold bracelet or gold-capped tooth might not seem like much of a retirement plan, but gold stocks, ETFs, coins and bullion are viewed by many as part of a well-diversified portfolio. This inherently valuable commodity typically rises in price when investors’ faith in the economy dims.
Between the end of December and the end of August, the price of gold in Canadian dollars rose 23% from just under $3,800 to over $4,600. It reached an all-time high of around $5,200 in September.
Crypto has likewise been on a strong upward trajectory this year. It’s estimated that 31% of people in Canada will be using crypto by 2026. Over the course of 2025, crypto market revenue in Canada is expected to increase by an annual rate of 10.14%.
Bitcoin has been on a tear since late last year, barring a downward spike in April when the US announced global tariffs. The price of BTC first hit the $100,000 USD mark in December and reached an all-time high of more than $124,000 USD (over $170,000 CAD) in mid-August.
With the creation of the US government’s Strategic Bitcoin Reserve and a number of businesses adding crypto to their holdings, investors may see what used to be regarded as speculative gambling become normalized as part of a savvy, modern investment strategy.
Canadian investors haven’t let the ups and downs of 2025 scare them away from the market. Stocks and ETFs remain popular, particularly in the technology, financials and materials sectors. This year has seen a surge of interest in alternative investments like private equity, gold and cryptocurrency.
However, increased investment in bonds and money market instruments (especially Government of Canada treasury bills) suggests a cautious attitude. Time will tell if 2026 will heighten investors’ defensiveness or encourage their optimism.
