2025's Biggest Market Bets Deliver Wins, Wipeouts and Sharp Reversals

Markets in 2025 became a showcase of high-conviction trades that often unraveled just as quickly. Political shifts, leverage and crowded positioning powered sharp rallies across assets, only to reverse when sentiment cracked or liquidity thinned. Crypto trades tied to Donald Trumps return to the White House briefly surged before fading, with Trump-linked tokens and American Bitcoin sliding sharply from their peaks, while Bitcoin itself fell from its October high and is on track for an annual loss. In equities, skepticism crept into the AI boom after Michael Burry (Trades, Portfolio) s Scion Asset Management disclosed deep out-of-the-money put options on Nvidia and Palantir Technologies , a filing that jolted markets even as questions lingered over the trades structure and duration.Elsewhere, geopolitics and macro stress rewired capital flows. European defense shares rallied as governments boosted military spending, pushing a Bloomberg basket of the sector up more than 70% for the year through Dec. 23 and reshaping ESG playbooks. Gold climbed to repeated records amid talk of a debasement trade, even as Treasuries moved toward their best year since 2020 and the dollar steadied, underscoring how fiscal fears and demand for safety can coexist. Japans bond market flipped a long-standing script, with yields surging past multi-decade levels and turning the once-notorious widowmaker trade into a profitable short, while South Koreas equity market jumped more than 70% as foreign investors piled in, even as local retail money flowed out and pressured the won.Credit and balance-sheet trades delivered some of the years most pointed lessons. Jim Chanos (Trades, Portfolio) s short of Strategy Inc. against a long Bitcoin position paid off as the companys premium to its crypto holdings shrank, while aggressive creditor-on-creditor tactics around Envision Healthcare generated sizable gains for select funds after Amsurg sold to Ascension Health for $4 billion. At the same time, speculative fervor lifted Fannie Mae (FNMA) and Freddie Mac (FMCC) shares on privatization hopes following Trumps re-election, before skepticism resurfaced over timing and feasibility. From Turkeys carry trade collapse after sudden political unrest to a string of smaller corporate credit failures that prompted JPMorgans Jamie Dimon to warn of more cockroaches, 2025 left investors heading into 2026 mindful that powerful narratives can carry prices far but not indefinitely.