Review of Asset Class Returns
- Asset class returns over the last year (14 September, 2015 – 14 September, 2016).
I have mentioned previously on this blog that we are entering a lower return environment and looked at expected returns over the next 10 years “Looking Ahead at Markets and Inflation” (updated in December 2015 “Expected asset Class Returns over the next 10 Year”).
Market Dynamics Are Changing
It has been a topsy-turvy ride on the stock exchange, as this graph shows. It also shows there is little point in being concerned about short-term movements. Since the middle of 2014 movements have been in a fairly narrow band, hovering between about 47 000 and 54 000. The moral of the story is one needs to invest for the medium to long term and not over react to short term market fluctuations.
Looking Back at the First Quarter of 2016
Is 2016 turning out to be an annus horribilis for investors and the country’s economy? Not necessarily, but it certainly was a bumpy ride during the first quarter. No-one promised it would be plain sailing, with the tide turning against emerging markets, interest rates joining inflation in an upward spiral, and the threat of a further credit downgrading facing the Republic.