Investing: It’s An On-Going Process, Not A Point In Time

At any gathering around the world, I’m invariably approached by someone who wants to know when and where they should enter the market. For the past couple of years, those of my friends and family in the States have been pleased with how their portfolios have been performing.  I generally agree with them knowing that there is significant home country bias in their portfolios.  However, the rest of the world hasn’t fared as well.  In our market, primarily the US expat market, we hear something opposite from those in the States.  Presently, 22 August 2016, the US is all but fully valued (some may say over-valued) according to Research Affiliates . It’s impossible to pick and choose markets in advance to garner the benefits that appear to be easy to select in the rear view mirror.  Times are challenging now.  In fact, times are generally challenging.  Below are some of some of the key indices around the world to provide some insight as to how things really are and have been over the past few years.  It’s very easy to take a snippet from an article or listen to the talking heads on television and believe that markets are doing something they’re actually not.  As Wealth Managers, our job is to provide a solid portfolio structure that will give the best chance of a positive result based on risk appetite.  We diversify broadly, both from a geographical and industry perspective.  The easiest way to keep this in mind is to think about the late 1990’s.  Tech was the rage and if you weren’t in it, you would receive paltry high single to low double digit returns.  That was great while it lasted, but, like all other fads, that fizzled and many people and institutions were burned.  Don’t give in to the hype of greener pastures.  You’ve heard it before, this time, make sure you don’t go searching.

YTD (31 July 2016) 2015 2014 2013 2012 2011
S&P 500 TR USD 7.7 1.4 13.7 32.4 16.0 2.1
MSCI World ex USA NR USD 1.8 -3 -4.3 21 16.4 -12.2
MSCI EM NR USD 11.8 -14.9 -2.2 -2.6 18.2 -18.4
Citi WGBI USD 11.3 -3.6 -0.5 -0.4 4.1 6.3
Figures sourced from Yahoo Finance and are index figures. You cannot invest directly in an index.


Risk Warnings

Past performance is not a reliable indicator of future results. Currency fluctuations may increase or decrease the returns of any investment. Prof form results such as those shown do not represent actual trading, returns will be affected by advisor and fund management fees, trading costs and other applicable charges.

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