Dear Investors,
In 2025, global stock prices rose. It felt great.
But what we witnessed in 2025 is the symptom of success, not the source of it. True success is found in the process—not the outcome—and the process is often arduous and unglamorous. In investing, winners learn to enjoy the process; failures fixate on outcomes.

The visible results we enjoyed in 2025 were shaped by decisions we made over the last few years—some planted even earlier.

A few examples of “process before outcome”
1) Chinese equities — planting seeds during the hard years
Chinese equities delivered a strong rebound in 2025. Yet the groundwork for that success was laid during the period when China was publicly deemed “uninvestable” by many prominent market participants—from mid-2021 to early-2024. The Hang Seng Index nearly
halved from its 2021 peak to its 2024 trough. After careful study, we concluded the drawdown was more likely a painful but temporary
phase—China was deleveraging and transitioning from a developing economy towards a more advanced one. We used the deep price correction to add Chinese equities into our portfolios.

For example, in November 2023, we decided to allocate an additional 15% of our Advised Funds Growth portfolio to Chinese equities. At the time, the news flow was negative and prices were depressed. It took fortitude to sow the seeds for a harvest that only became visible in 2025—and we did.

2) Gold — conviction that only becomes “obvious” later
We insisted on holding gold in our portfolios as early as November 2011, when Unicorn was founded, because we believe it is the ultimate safe-haven asset. Many of our investors entrust us with their core savings, so capital preservation and resilience have always been top priorities.

For most of our portfolios, gold forms around 10-20% of the allocation. Over the years, many friends in the asset management world criticize us saying that was “too much”—most conventional portfolios either hold no gold, or hold a token amount (often no more than 5%). In 2025, some of those same friends told us they would like to take back their words. That is how investing often works: the discipline looks unnecessary—until the day it is needed.

3) Copper and silver — risk management through margin of safety
Alongside gold, we have also studied copper miners and silver as potential opportunities, but have not implemented these ideas. Unlike gold (predominantly a monetary/precious metal), copper is largely tied to industrial production, and silver has significant industrial use as well—making both far more economically sensitive. Even in a normal slowdown, a 30–50% drawdown is not uncommon.

To preserve a margin of safety, we believe the best time to build exposure to these assets is typically after an economic slowdown, when prices already reflect stress. Until then, we are content to hold gold as our primary commodity proxy for hedging inflation shocks, geopolitical instability, and black-swan events.

We maintain a target allocation to precious metals. If we add silver or copper miners, it would likely be funded by reallocating from gold rather than increasing overall exposure. Given our early positioning in gold since 2016—the earliest point we could include gold in our managed portfolio (before that, we could only advise investors to buy gold themselves)—it has delivered a gain of more than 250%. This early strategic positioning allows us to stay prudent and patient, without needing to chase returns in silver or copper
miners.

The world today

We operate in a world shaped by powerful forces:

1. Heightened geopolitical tension
As global power dynamics shift, defence spending is rising, supply chains are being reconsidered, and uncertainty can surface abruptly. In such periods, safe-haven assets can provide a harbour when conditions turn ugly.

2. AI and robotics
Artificial Intelligence is still at an early stage. Together with robotics, it may reshape productivity, business models, and job markets. Many roles will be disrupted, many new ones will emerge—and over time, productivity gains can lift corporate profitability through higher efficiency and improved margins.

3. Global debt and the realities of fiat money
The world has become increasingly dependent on debt. In a fiat money system (money not backed by gold), policy choices matter immensely. As former Fed Chair Ben Bernanke once noted, governments ultimately have the ability to create currency. In practical terms, governments rarely tolerate deflation for long because deflation makes debt harder to service. This reality clarifies our long-term approach: we want exposure to assets that cannot be printed—and we want portfolios that can withstand multiple regimes (growth, recession, inflation, and shocks).

Our strategy for 2026

Macro backdrop: supportive, but returns may be more measured

2026 will likely be shaped by the policies of the world’s two largest economies: the US and China.

US: President Trump faces the mid-term election in November. With Republicans currently
controlling both the White House and Congress, he has strong incentive to keep the economy supported and voters confident. This points to a looser fiscal stance. He has also repeatedly called for lower interest rates. Rates have been trending down since end-2024, and we think this could accelerate after he potentially appoints a new Fed Chair in May.

China: China has already been running loose fiscal and monetary policies to stabilise growth, and this is likely to continue. Together, these policies should provide a tailwind to the global economy. However, the economy is only the environment where assets exist. What matters is asset value and pricing—and after several years of rising markets since late-2022, many assets are no longer cheap. Hence, we expect returns in 2026 to be more measured, with valuation discipline playing a bigger role.

AI: participate, but with risk controls

AI spending will likely continue in 2026 because companies can’t afford not to invest—they risk disruption and obsolescence. Over time, we believe this spending can translate into productivity gains and new revenue streams.

Many worry about an AI bubble. But bubbles are irrational, and timing the peak is futile. A bubble is usually clear only after it bursts—and the biggest gains often come near the end. That is why being early is often indistinguishable from being wrong. History is a good reminder. During the Dot-com boom, Alan Greenspan warned of “irrational exuberance” in December 1996. The market only crashed in March 2000—and the Nasdaq surged 300% in the years in between.

So we focus on what we can control:
1. Keep AI exposure within 15%.
2. Rebalance—harvest gains as prices rise and redirect into gold, bonds, and other quality companies.
This way, we participate if AI continues to run, while staying protected if the cycle reverses.

Key risk: inflation returning

The main risk to 2026 is the re-acceleration of inflation—driven by stimulative policies and large-scale investment cycles (including AI infrastructure). Inflation can be disruptive because it can pressure both equity and bond valuations simultaneously, as we witnessed in
2022.

Portfolio positioning

In summary, our approach in 2026 is:
1. Main asset allocation: stay the course, with comprehensive hedging

A conventional portfolio often hedges equities primarily with bonds (especially longer-dated bonds). We believe that is incomplete. Bonds hedge recession risk reasonably well, but in inflationary regimes, equities and bonds can fall together, like we witnessed in 2022-2023. We will continue to manage drawdown risk more comprehensively—using both precious metals and bonds alongside diversified
equity exposure.

2. Sub-asset allocation: quality at reasonable prices, with greater emphasis on valuation

We remain committed to buying quality assets at reasonable prices. That discipline is the best long-term insurance against permanent capital loss. What worked in 2025 can still work in 2026—but valuation matters more now because many assets are no longer cheap.

A personal note on your wealth plan

What I have shared above relates to portfolio strategy. At a personal wealth management
level, I encourage you to:

1. Meet your Family Wealth Consultant to revisit your profile and ensure your portfolios still fit your goals and life stage.

2. Revisit the strategies you put in place (such as the 3-Bags Strategy and any Regular Savings Plans) to confirm they remain suitable for you.

3. Keep learning consistently – A sound strategy alone is not enough for investment success. It must be matched with the emotional discipline to stay the course through inevitable market cycles. That discipline is not inborn—it is cultivated over time through continual learning and the steady growth of financial wisdom.

Success in investing does not belong to those who always forecast correctly or always pick the best stocks—because such people do not exist. It belongs to those with a sound intellectual framework and the emotional discipline to follow it.

At Unicorn, we will continue to earn your trust through rigorous research, disciplined risk management, and a commitment to keep learning and improving—together with you.
Wishing you a joyful and prosperous New Year.

Warm regards,
Seow Kek Wee
Chief Investment Officer
Unicorn Financial Solutions

Disclaimer and Important Notice

The information herein is published by Unicorn Financial Solutions Pte. Limited (“Unicorn”)
and is for information only. This publication is intended for Unicorn and its clients or prospective clients to whom it has been delivered and may not be reproduced or transmitted to any other person without the prior permission of Unicorn. The information and opinions
contained in this publication have been obtained from sources believed to be reliable but Unicorn does not make any representation or warranty as to its adequacy, completeness, accuracy or timeliness for any particular purpose. Opinions and estimates are subject to
change without notice. Any past performance, projection, forecast or simulation of results is not necessarily indicative of the future or likely performance of any investment. Unicorn accepts no liability whatsoever for any direct indirect or consequential losses or damages
arising from or in connection with the use or reliance of this publication or its contents. The information herein is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation. If this publication has been distributed by electronic transmission, such as e-mail, then such transmission cannot be guaranteed to be secure or error free as information could be intercepted, corrupted, lost, destroyed, arrive late or incomplete, or contain viruses. Unicorn does not accept liability for any errors or omissions in the contents of this publication, which
may arise as a result of electronic transmission.

Unicorn Financial Solutions Pte. Limited is a Licensed Financial Adviser and Accredited/Institutional Licensed Fund Management Company.

Source: Flickr

You have probably heard the story of the Three Little Pigs. The first pig built his house of straw, the second of sticks, and the third of bricks. Then came the Big Bad Wolf, who blew the first two houses down with ease. Luckily, the first two pigs took refuge with the third, whose brick house stood firm despite the wolf’s huffing and puffing.

But wait — isn’t this supposed to be an article about investing?

Exactly.

Stories often carry powerful lessons, and this one is no exception. The brick house survived because it was built on a solid foundation — a strong framework.

Merriam-Webster defines framework as “the basic structure of something: a set of ideas or facts that provide support¹.” When a framework is robust and well-designed, it provides safety, stability, and peace of mind.

The same is true for investing. A sound investment framework helps you weather market storms and reduces the emotional rollercoaster that volatility can bring.

Warren Buffett, arguably the world’s greatest investor, once said:

“To invest successfully over a lifetime doesn’t require a stratospheric IQ, unusual business insights, or inside information. What’s needed is a sound intellectual framework for making decisions — and the ability to keep emotions from corroding that framework².”

This kind of framework is more important than ever in today’s fast-moving, noisy investment environment. News headlines can swing your emotions wildly from one day to the next. A well-structured plan helps you stay grounded, confident, and focused on what truly matters.

At Unicorn, we call our framework The Three Bags Strategy. As the name suggests, you divide your funds into three distinct “bags,” each serving a specific purpose.

Bag 1: The Contingency Fund

This is your financial safety net — the cash you set aside to cover emergencies and unexpected events. It should be large enough to support you and your family during difficult times so you do not have to liquidate investments at a loss.

For example, during the 2008 sub-prime crisis, retrenchments were common. Those without adequate emergency funds were forced to sell investments — often at depressed prices — just to cover daily expenses.

The size of your contingency fund varies from person to person, and keeping too much cash can also hurt your long-term returns. A professional financial consultant can help you strike the right balance.

Bag 2: The Invested Fund

Inflation never sleeps. Simply parking your money in the bank is no longer enough to keep pace with rising costs. This second bag is where your money works for you — carefully invested in well-researched, valuable assets.

At Unicorn, we actively look for high-quality assets trading at attractive prices — the kind of opportunities value investors like Warren Buffett love. Strategic asset allocation plays a crucial role here.

For instance, in 2009, we advised investors to allocate up to 30% of their portfolios into U.S. equities, which had been heavily battered during the sub-prime crisis. Many investors stayed on the sidelines, but those who followed our advice saw their portfolios grow significantly — the S&P 500 rose nearly 80% before we advised taking profits in 2013³.

This bag is also perfect for Dollar Cost Averaging (DCA) — consistently investing a fixed amount at regular intervals (e.g., monthly). When markets dip, your money buys more shares; when markets rise, you buy fewer. This discipline takes emotions out of the equation and builds your portfolio steadily over time.

Bag 3: The Value Cost Averaging (VCA) Fund

Warren Buffett’s famous advice is to “be greedy when others are fearful and fearful when others are greedy⁴.” Markets often fall because investors panic, creating opportunities for those with cash ready to deploy.

This third bag is your “opportunity fund.” It allows you to take advantage of underpriced assets during market corrections — without touching your contingency fund.

For example, in 2016, we activated this bag and recommended that our investors buy gold after its price had fallen from its 2011 peak³. Our analysis suggested that volatility and uncertainty were likely to rise, and gold typically performs well in such environments. That call turned out even better than we expected as gold prices surged in the years that followed.

Putting the Framework to Work

Together, these three bags form a simple yet powerful framework that removes the guesswork from investing. Your first step should be to work with a trusted family wealth consultant to establish these foundations before — or as — you begin your investment journey.

The next step is to choose the right advisor. Your consultant should have the skill and discipline to select the right assets and guide you through good times and bad.

At Unicorn, we take pride in aligning our interests with yours. We remain vigilant, proactive, and transparent — keeping you informed not just when times are good, but especially during market turbulence. Because when your framework is solid, you can focus on building a future you and your family can feel secure about.

Source

1 – Merriam-Webster 

http://www.merriam-webster.com/dictionary/framework

2 – The Intelligent Investor

3 – Bloomberg

4 – Investopedia

Warren Buffett: Be FearFul When Others Are Greedy https://www.investopedia.com/articles/investing/012116/warren-buffett-be-fearful-when-others-are-greedy.asp

Source: CartoonStock

Would you be open to engaging a portfolio adviser who only earns when your portfolio does well?”

That is exactly what you get when you invest with Unicorn.

Such a fee structure is almost unheard of in today’s financial industry. For investors, it should be comforting to know that such a portfolio adviser exists — right here in Singapore. This is the kind of set-up that investors, both locally and globally, have been yearning for. Most portfolio advisers scoff at the very suggestion of it.

Unicorn currently offers this performance-based service through:

• Unicorn Securities – Minimum investment: S$250,000

Investors’ Problem with Portfolio Advisers

US$100 billion — that’s the staggering amount Warren Buffett estimated that pension funds, endowments, and wealthy individuals lost between 2001–2010 to hedge funds and other managers who charge sky-high fees.¹

At first glance, Buffett may seem to be discouraging investors from using portfolio advisers at all. But that’s a misunderstanding. Buffett’s real contention is not with the use of managers — after all, Berkshire Hathaway essentially functions as a fund — but with managers who charge high fees and fail to deliver outperformance.1

Unfortunately, many investors took Buffett’s remarks as a cue to complain about any and all fees, calling them “gross” and “unjustified.”

But here’s the reality: paying more does not always guarantee superior results — and nowhere is this truer than in investing.

Would a Berkshire Hathaway shareholder complain about paying Buffett high fees, knowing the extraordinary returns he has generated? Hardly. A simple estimate of a US$1,000 investment in Berkshire in 1964 is worth about US$28 million today.²

What Should Investors Do?

Instead of obsessing over the absolute amount of fees, look at the fee structure. It reveals much about a portfolio adviser’s motivations and alignment with you.

Imagine this scenario:

You are a shareholder of a struggling company seeking a new CEO to turn things around. One candidate proposes:

• No pay until the company becomes profitable
• 20–30% share of profits thereafter

What does this tell you?

1. Alignment of Interests – He is literally in the same boat as you. You pay only when there is performance.
2. Confidence – Only someone sure of their ability would accept such a challenge.
3. Desire to Succeed – As Napoleon Hill said:

“When a man really desires a thing so deeply that he is willing to stake his entire fortune on a single turn of the wheel in order to get it, he is sure to win.”

Apple’s legendary CEO Steve Jobs did just that. When he returned to Apple in 1997, he revitalised the company — while drawing an annual salary of just US$1, relying instead on stock options tied to performance.³

Conclusion

Finding a good portfolio adviser or wealth planner is critical to your financial success. But don’t just look at performance numbers — scrutinise how they charge.

A fee structure is like a microscope: it magnifies who the manager really is, what they stand for, and whether they are truly on your side.

When you find a manager who is willing to bet on themselves — to win only when you win — you may have found the “good shepherd” who will grow your flock.

And when you do, remember: quality comes with a price — but a high price does not always mean quality.

Source

1 – Warren Buffett rails against fee-hungry Wall Street Managers https://www.reuters.com/article/world/uk/warren-buffett-rails-against-fee-hungry-wall-street-managers-idUSKBN1640FF/

2 – Deep Seek (How much is a US$1,000 investment in Berkshire in 1964 worth today)

3 – Steve Jobs Still Makes a $1 Salary

http://techland.time.com/2011/01/12/steve-jobs-still-makes-a-1-salary/

Certified Advanced Financial Planner (CAFP)

The CAFP designation represents a mark of distinction earned by a select few within our firm who have demonstrated exceptional technical proficiency, strategic thinking, and commitment to investor success.

Out of the hundreds of professionals trained over the years, only three have attained this rigorous certification—testament to the high standards and deep expertise required. CAFPs are often called upon by fellow practitioners across the firm to support key investor engagements, where they conduct in-depth financial diagnostics and develop tailor-made blueprints with solutions that are both precise and easy for investors to embrace.

In addition to their advisory role, CAFPs also lead the development of internal training curriculum, and set a strong example through the way they run their professional practices.

The CAFP designation is not an exam-based certification—it is a recognition earned through real, on-the-ground experience. It affirms those who have consistently walked alongside investors, helping them navigate complex financial challenges with clarity and care. More than a title, it’s a validation of meaningful impact, earned through mileage, not just modules.