And the winner is...
Grab your popcorn, movie awards season is upon us! The Golden Globes, Screen Actors Guild Awards and of course the Academy Awards kick off the year by recognizing “the best of the best” on screen for the last year.
Affectionately called The Oscars, the inaugural Academy Awards ceremony was first held in May of 1929 at the Hollywood Roosevelt Hotel where the star-studded event honored actors, directors, writers and of course, the best movie of the year.
From year to year, the winning genre varies depending on trends, current events and even the whim of the audience. Gladiator, Chicago, The Hurt Locker, The King’s Speech, and most recently Green Book have all taken home the top prize. These examples all fall in widely different categories yet provide audiences with captivating stories, life lessons and endearing characters that evoke emotion and connection. Movie fans wait in anticipation for nomination announcements and when the big night rolls around tune in to watch the winners (and the losers!).
Not unlike the movie awards, investment categories also prove to be hard to predict which one will be the big winner for the year.
In 2019, all categories of investments enjoyed a stroll on the red carpet. Both stocks and bonds performed exceedingly well thanks to low and accommodative interest rates and stellar economic output. Top category performers include U.S. Large Cap stocks, U.S. Real Estate and U.S. Mid Cap stocks posting returns of 31.5%, 28.9% and 26.2% respectively. Even one of the “lowest” performing classes for the year, U.S. Bonds, put up a healthy 8.7% return.
It is interesting to look at the pattern of performance over time. It’s almost always the case that the best performing asset class one year is never the same in the following. In fact, a good example is International stocks in 2017. For that year, International holdings were up more than 27%, second only to Large Cap Growth stocks. Twelve short months later at the end of 2018, International stocks were the worst performing asset classes losing more than 14%.
Fun fact, the best performing asset class in 2018 was Cash! How many investors out there could have predicted that shift and made the appropriate movements at just the right time? Almost no one.
This is why investment advisors always emphasize diversification and how important it is in constructing well-built portfolios. Various asset classes representing distinct areas of the marketplace and even different parts of the world. Yet they come together beautifully to create a balanced, effective and dynamic mix of investments designed to capture opportunity and mitigate risk where possible to help investors achieve long term financial successes and goals. Indeed, the principle of diversification is one of Unified Trust’s leading philosophies in the investment decision making process.
Our Trust Investment Committee is constantly evaluating global economic factors to assess the direction of financial and capital market movements. As needed, asset allocation models are adjusted and accounts are rebalanced to ensure our clients are invested in a manner that best suits their needs and interests over the short and long term.
The exact mix of asset classes may change over time, but the principle of diversification is always paramount.
Our team of professionals and your Fiduciary Investment Advisor are working diligently to help ensure your assets are working for you. Our goal is to create high quality and well diversified portfolios designed to help withstand volatility, protect against significant downside risk and keep you on the best path to achieving your financial goals.
As you tune in to the Academy Awards on February 9th, the winner may be the action-packed historical account of the feud between Ford v Ferrari or the classic tale of love and family in Little Women or the World War I drama 1917. Just like your investments, it’s certainly a diversified group!
Subscribe to our Blog
Receive each new post by email, making it easy to stay up to date on industry news, trends and important insights from the UnifiedTrust team.