The colorful and entertaining Callan ‘Periodic Table’ was recently updated with 2018 market results. It tracks the investment returns of key indices over the past two decades. The most recent year – the 20th in the chart – was challenging. As you can see, cash was king and few investments posted positive returns.
I have often referred to the chart as “fascinating, but useless” because it’s patchwork quilt of colors seems to defy any real pattern or logic. Anyone who thinks they can peg the next hot asset class by studying it will be terribly disappointed to be reminded that “historical returns are no guarantee of future performance”.
Instead, I would use it as an annual reminder that one should rebalance their portfolio regularly. Thinking there are any historical insights that might help you adjust your asset allocation with the hopes of ‘timing the market is a fool’s errand.
Image Credit: Callan