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28 Jan 2022

Asset Class Returns: The last 41 years…

Morning all and what a start for 2022.

Growth and defensive asset prices have dropped from their peaks and the US Federal Reserve has reaffirmed that it will begin lifting interest rates in March 2022. The current target range 0-0.25% is likely to be increased to 0.25-0.50% because they want to slow down inflation in the United States.

We keep asking whether 2022 is going to be a repeat of 1994 when the US Federal Reserve rapidly increased interest rates and Australia followed causing financial chaos for both growth and defensive assets.

Remember clearly how 1994 was an absolute financial disaster and there was nowhere to hide other than cash.

As we wait to see how 2022 unfolds the numbers are in for calendar year ending 31 December 2021 and growth assets took out the top two spots with with internationally listed companies posting the best performance closely followed by property (specifically Australian listed property).

WARNING, past performance is no guarantee of future performance and these index return figures do not reflect the ability of top professional investment management teams to outperform their respective index/benchmark. Most importantly, the above does not constitute Personal Advice.

Furthermore, these figures do not show the opportunity for a client to buy low and add to their investment holding when an asset class is out of favour which in turn can accelerate the rate of return well above the index performance.

Click for index returns.


At Newealth we are always looking to support and promote our clients wherever possible and if you have any ideas or comments, please feel free to email me or to call me on +61 2 9267 2322.

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