When it comes to financial planning and making investment decisions, it turns out that having a grateful mindset can be a game changer. To quote Dr. Daniel Crosby, Orion’s chief behavioral officer and author, “Research offers a surprisingly consistent message: gratitude isn’t just good for the soul, it measurably improves our decision-making and overall wellbeing.”
“Practicing gratitude is associated with better financial decisions, stronger relationships, deeper friendships, lower blood pressure, and improved mental health,” Dr. Crosby says. “For the effort involved, it may be one of the highest return habits we can build.”
What a simple and yet profound concept. Being grateful is a powerful strategy.
In our ETF industry, there is so much to be grateful for. Here are my top three reasons this year:
- The easy access to portfolio diversification ETFs provide.
- The transparency that extends beyond the ETF wrapper into investment insight.
- The people. It all always comes down to the people.
Diversification
In the day to day life of investing, advising, asset management and navigating markets, there’s a lot going on all of the time. Thanks to loads of data (timely and/or delayed), geopolitical heat, changing narratives and policy moves, this year has been especially action-packed.
Look at the S&P 500 as an example. We kicked off 2025 in difficult territory, with the benchmark dropping 15% by the first week of April. It was a tough first quarter. Then came the April 8 tariff scare, and the S&P 500 slid 7.5% in just two days. Next, we watched the market rally more than 33% from that April low to date. The benchmark now sits about 15.5% higher in 2025. Some of us were reaching for the paper bags.
Throughout the ups and down we debated at length whether AI was indeed changing the world, and if focusing on the Magnificent Seven or betting on “the 493” was the better way to go. We argued gold vs. bitcoin, growth vs. value, large- vs. small-cap, U.S. vs. international. We explored and retreated on duration risk. We fretted over the debasement trade. We did lots of things as market leadership and thematic opportunities ebbed and flowed. We coined 2025 as the year of uncertainty.
Morgan Housel, author of several books including The Psychology of Money, in a conversation with Chris Davis of Davis Advisors, once put it: “People are actually very good at forecasting the economy, except for the surprises, and the surprises are all that matter.”
“If you are only prepared for the risks that you can envision, 10 times out of 10 you’re going to miss a surprise,” he said. “Therefore you need to have a level of conservatism and preparedness in your finances that doesn’t make sense. If it makes sense, you’re missing the surprise, always.”
Conservatism can mean different things to different people. But consider diversification as one possible interpretation. Preparing for the unexpected can often be done through sound portfolio diversification. And ETFs, as building blocks and investment vehicles, are a beautiful solution to our diversification needs.
ETF asset flows so far in 2025 show that investors have turned to ETFs to navigate challenging markets, and more importantly, to diversify portfolios. Classic diversifier-type categories like alternatives, commodities, and asset allocation solutions are all punching above their weight this year in the asset gathering vs. asset footprint race. ETF investors have pursued diversification, which ETFs so easily and beautifully enable.
That’s something to be thankful for.
