December 2025 Investylitics

Horizon Advisor Network Investment Committee December 8, 2025

The Horizon Advisor Network Investylitics Committee members met the afternoon of Monday, December 8th. As we move into the final month of the year, we were happy to have the opportunity to review the research from the various market strategists and economists that the committee follows. After our meeting last month, the longest U.S. government shutdown in history, which lasted 43 days, ended on November 12, 2025.

This has allowed important economic data points on inflation and unemployment to resume. Early indications are that the economy is doing better than expected. The PCE inflation report, which is the Federal Reserve's preferred inflation measure, recently came in below expectations. When the September jobs report was finally released, it showed more jobs created than had been predicted. Weekly unemployment claims have fallen below 200,000, which should support unemployment remaining near current levels.

All eyes will be on the Federal Reserve Bank meeting, which concludes on Wednesday afternoon, December 10th, at 2:00 PM. Financial markets are pricing in approximately an 87% chance of a 25-basis-point interest rate cut, the third consecutive cut this year. This move would bring the federal funds rate to a target range of 3.50% to 3.75%. As you can see in our first chart below, the Fed funds rate tends to follow the two-year treasury rate with a high degree of correlation.

Beyond the rate cut itself, markets will intensely focus on the Fed's new Summary of Economic Projections (SEP) and Chair Jerome Powell's 2:30 p.m. ET press conference. There are unusual and deep divisions within the Federal Open Market Committee (FOMC). Some officials favor more cuts to support employment, while others worry that stubborn inflation (still above the 2% target) warrants caution. The decision is expected to have a higher-than-usual number of dissents, potentially in both "hawkish" (no change) and "dovish" (larger cut) directions.

Turning our attention to the markets, we recently passed the three-year anniversary of the current bull market, which started in October 2022. While many investors are concerned that the recent strong market returns can't continue, history shows that bull markets typically last more than six years on average, as shown in the following chart. We know that past performance does not guarantee future returns. However, the chart shows that the current advance is only half as long as a typical one, while its returns are less than 1/3 of a typical bull market's.

After three years of strong portfolio returns, it is typically wise to rebalance your portfolio and raise cash for any short-term needs. Please remember that our job as your advisors is not to help you predict what will happen in the markets in the short term, but to help you prepare and take the steps necessary to achieve your financial goals.

As we move through the holiday season and into the new year, the committee is thankful for and appreciates your continued confidence in our process and our commitment to serving you with excellence. We hope that the holidays give you a chance to focus on what is truly important. As always, we are here if you have questions or want to talk through your unique family and financial situation.

The views stated in this piece are not necessarily the opinion of Cetera Advisors LLC and should not be construed directly or indirectly as an offer to buy or sell any securities. Due to volatility within the markets, opinions are subject to change without notice. Information is based on sources believed to be reliable; however, their accuracy or completeness cannot be guaranteed. Past performance does not guarantee future results.

Investors cannot invest directly in indexes. The performance of any index is not indicative of the performance of any investment and does not take into account the effects of inflation and the fees and expenses associated with investing.

A diversified portfolio does not assure a profit or protect against loss in a declining market.

Re-balancing may be a taxable event. Before you take any specific action be sure to consult with your tax professional.

The IA SBBI US Large Stock TR Index is an unmanaged index that is generally considered representative of the historical U.S. stock market on a total return basis prior to the inception of the S&P 500 TR Index in 1970.

The Russell 1000 Growth Index measures the performance of the large-cap growth segment of the U.S. equity universe. It includes those Russell 1000 Index companies with higher price-to-book ratios and higher forecasted growth values.

The Russell 1000 Value Index measures the performance of the large-cap value segment of the U.S. equity universe. It includes those Russell 1000 Index companies with lower price-to-book ratios and lower forecasted growth values.

The Russell 1000 Index measures the performance of the 1,000 largest companies in the Russell 3000.

The Russell 2000 is a stock market index measuring the performance of 2000 small capitalization stocks. It represents the 2000 smallest companies in the Russell 3000 Index, which in turn represents the 3000 largest companies in the U.S.. Thus, the Russell 2000 is a barometer of small-cap stocks. Though small, the companies represented by the Russell 2000 are not the smallest of the small as they are not penny stocks. The Russell 2000 is weighted by the market capitalization of the stocks.

The MSCI USA Sector Neutral Quality Index captures large and mid-cap representation across the U.S. equity markets. The index aims to capture the performance of securities that exhibit stronger quality characteristics relative to their peers within the same GICS sector by identifying stocks with high quality scores based on three main fundamental variables: high Return-on-Equity (ROE), low leverage and low earnings variability.

The MSCI USA Quality Index is based on the MSCI USA Index, its parent index, which includes large and mid cap stocks in the U.S. equity market. The index aims to capture the performance of quality growth stocks by identifying stocks with high quality scores based on three main fundamental variables: high return on equity (ROE), stable year-over-year earnings growth and low financial leverage. The MSCI Quality Indexes complement existing MSCI Factor Indexes and can provide an effective diversification role in a portfolio of factor strategies.

Sincerely,

Jesse W. Hurst, CFP®, AIF®
Senior Financial Planner and CEO

*Award Recipient Jesse Hurst 

Forbes: Best-in-State Wealth Advisors Award received by Jesse Hurst, Senior Wealth Advisor, (2018-2024). The Forbes ranking of Best-In-State Wealth Advisors, developed by SHOOK Research, is based on an algorithm of qualitative data, rating thousands of wealth advisors with a minimum of seven years’ experience and weighing factors like revenue trends, assets under management, compliance records, industry experience, and best practices learned through telephone and in-person interviews. Portfolio performance is not a criteria due to varying client objectives and lack of audited data. Neither Forbes nor SHOOK receive a fee in exchange for rankings. Research summary as of April 2024: - 44,990 nominations received, based on thresholds - 23,876 invited to complete online survey - 20,412 telephone interviews - 4,926 in-person interviews at Advisor's location - 1,507 virtual interviews. Listing in this publication and/or award is not a guarantee of future investment success. This recognition should not be construed as an endorsement of the advisor by any client. No compensation was provided directly or indirectly by the recipient for participation or in connection with obtaining or using the third-party rating or award.

¹ This recognition and the due–diligence process conducted are not indicative of the advisor's future performance. Your experience may vary. Winners are organized and ranked by state. Some states may have more advisors than others. You are encouraged to conduct your own research to determine if the advisor is right for you. 

² Portfolio performance is not a criterion due to varying client objectives and lack of audited data. SHOOK does not receive a fee in exchange for rankings.