Below is a look at 10-year annual returns of major asset classes in 2008, 2013, and 2016. What’s notable is how an asset class deemed “today’s favorite” becomes a “dawg” a handful of years later. For example, in 2013 emerging market stocks led the pack with a 10.5% annualized return only to severely underperform thereafter,…Read More
Foreign exchange (currencies) might be, after gold, the most misunderstood asset in the world.
Why, for example, is the Japanese yen quoted yen per U.S. dollar while the euro is quoted as U.S. dollar per euro?Read More
Within financial markets, gold may be the most misunderstood asset in the world. To paraphrase famed investor Jeremy Grantham, it’s fair to say that gold is a “faith-based” metal.
Because gold is somewhat complex in terms of what drives its value, I’ll share some insight and perspective on this precious metal to better understand its role globally and in today’s financial markets.
During the August 2015 stock market selloff, the S&P 500 dropped 11% while a managed futures strategy gained 3.50%. And, during the most recent year-to-date drop in stocks, the S&P 500 declined by over 10% while managed futures rose by 7%. Strategies that are uncorrelated to stocks, such as managed futures, provide enhanced diversification benefits to a typical stock/bond asset allocation.Read More