ETF Returns

ETF returns since 2008.  Here are a few observations.  

Longer-term  economic progress has historically been a great healer of market declines.  This has historically been true of run-of-the mill corrections like we saw last year and true bear markets like we experienced in 2008.    I wish this graph had 2007's 2nd half numbers up here as well so we'd see the true depths of the last bear market, but the point would still be the same.

If you're in equities then there's no place to hide when the tide goes out.  Stocks go down mostly in unison when liquidity is drained out of the markets.  

Owning this entire basket above on an equal weighted basis in 2019 would've returned a bit over 17% if my math's correct.  Owing an equal weighted portfolio of just the equities and cash would have shown approximately a 22% return in 2019.  Those one year returns though need to be balanced with the 2018 losses which was mostly a 4th quarter 2018 event.  Averaging 2018-19 together brings those two years returns a bit down to earth.

It is very hard to ignore the massive equity underperformance of the rest of the world to the United States.  

Cash is showing here with a return of 2.2%.  10-year US government treasuries are yielding 1.88%.  Hard for me to get excited about bonds under nearly every circumstance at those levels and at that short-term cash differential.

Back later this week.

Link:  The twitter feed of Charlie Bilello. 

*I am long via ETFs US large Caps, US REITS, Preferred Stocks, EAFE stocks and EEM in both client and personal accounts, although not necessarily in the same names listed above.  Also own a minimal amount of GLD and small cap ETFs in certain client and personal accounts.  Please note these positions can change at any time without notice.

**This post should have also noted long US mid caps and in a few legacy accounts small caps via ETFs in client and personal accounts.  I regret the error.