Happy New Year and welcome to another year of the Weekly Investment News.
Given it was a shortened period last week, we’ll revert to our usual format from next Monday. With that in mind we’ll take the opportunity to reflect on some key points from 2022, and outline what we hope to be able to bring you over the coming weeks and months.
2022 turned out to be one of the worst years on record for multi-asset investors. The classic 60/40 ‘portfolio in US dollar terms’ saw the largest decline since records began, Eurozone government bonds saw their worst year since the currency bloc was incepted, and global equities in euro terms saw their worst year since 2008. There’s plenty of more examples, but in conclusion 2022 was unique for mostly the wrong reasons. As always, the headline figures are included in the below table.
With the benefit of hindsight, many of the reasons for the above are clear and have been well documented. However, I wonder who could have predicted that there was a war in Europe, but equities would outperform bonds. And that the world’s largest oil and gas supplier would start the war, but prices would be lower by the end of the year. The difficulty in not only identifying a material market event, but also the reaction to that event, highlights the importance of a defined investment process and philosophy.