U.S. Equity Sector Periodic Table Of Annual Total Returns 1992-2016

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The Callan Periodic Table of Investment Returns for 2016 is not out yet. While we wait for the latest update, the chart for 2015 provides many valuable insights. Similar to the popular Callan chart, there are many types of charts are also online. Recently Fidelity published an interesting chart called a periodic table of annual total returns for US equity sectors in a U.S. Equity Sector 2017 Outlook Report.

U.S. Equity Sector Periodic Table Of Annual Total Returns 1992-2016:

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Note: The 2016 returns noted above are year-to-date returns through Oct 31, 2016.

Source: U.S. Equity Sector 2017 Outlook Report, Fidelity

A few observations:

  • Utility stocks have performed extremely well during the period shown. For most of the years they have returned a positive total return. Even in 2008 when US markets crashed, the sector was down only 15%. Since then each year they have had a solid performance. This shows that investors cannot go wrong holding US utilities.
  • While REITs also declined heavily in 2008, they have recovered strongly in the following years.
  • The Energy sector tend to be volatile as prices of crude oil and natural gas are always unpredictable. So even in terms of total returns, their annual performance varies wildly year-over-year.
  • Overall this chart shows the importance of diversification among various sectors. For example, when financials fell by 55% in 2008 during the Global Financial Crisis (GFC), US utilities declined by only 15%. Hence portfolio volatility can be reduced greatly by distributing one’s assets among various sectors.

Related:

What Type Of President Trump We Would Get?

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The inauguration of Donald Trump as the 45th President of the United States will take place on Friday, January 20, 2017. Because he is unlike any other President the country has had, there are lots of uncertainties regarding the policies that would be implemented by him. His administration may turn out to be one the most of the unpredictable.

There is plenty of uncertainty about what type of  President he would be in terms of economic policies. The following chart from ING shows the four possible positions he could take:

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Source:  Have markets become too excited about Trump? ING

A “Home Trump” would be the ideal choice for equity investors  and the general population alike.

The US Welfare State In One Giant Chart

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The US spends billions of dollars each year in welfare programs to poor people. Though it is the richest country in the world millions of Americans depend on the state for survival. According to the House Ways & Means Committee can astonishing $1 Trillion was spent on 80+ programs through various agencies and departments. The bureaucracy that has been built to spend this money is huge and inefficient as shown in the chart below:

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Source: House Ways & Means Committee

Hat Tip: In One Image, Everything You Need to Know about the Washington-Created Welfare State, International Liberty

Which Stock Market Has Crashed By 99.82% ?

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One of the worst stock markets in recent history is equity market of the Mediterranean island country of Cyprus. The Dow Jones Total Stock Market Cyprus Index peaked at 1605.9 in November, 2007. It closed the year 2016 at just 2.95. That is an astonishing plunge of 99.82%.

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Source: Google Finance

Though Cyprus is not a major equity market in the world by any means, it just shows the severity of crashes that can occur. Basically anyone that invested at the peak in 2007 lost almost all of their money. Or to put it another way, someone that invested 10,000 Euros at its peak would now have 18.0 Euros in their account.

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Why Investors Can Consider Chilean Stocks Now

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Chile must be on the radar of emerging markets investors. Among the major markets in Latin America, Chile is one of the best market due to many factors. Equity investors looking for emerging market opportunities now can especially consider adding Chilean stock. Some of the reasons why Chilean stocks offer excellent potential for income and growth are:

  • Chile is the world’s largest copper producer and exporter. After years of falling copper prices, copper is slowing moving up since the last quarter as shown in the chart below:

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Source: Kitco

As copper prices go up the Chilean economy will benefit. Moreover it should be noted that copper accounts for about half of all exports from Chile.

  • Chile is known for political stability in a region filled with many unstable economies.
  • The country is a member of the OECD and has numerous free-trade agreements enabling Chile to take advantage of trade partnerships with many countries.
  • Companies in Chile are required by law to distribute dividends to shareholders. By law, firms must pay at least 30% of their profits to shareholders. This type of law is unique in emerging countries.
  • This year general elections are due in November.

Some of the Chilean ADRs that investors can consider for further research include: Banco Santander- Chile (BSAC), Banco de Chile (BCH), Empresa Nacional de Electricidad SA (EOC), Itau CorpBanca (ITCB) and Vina Concha y Toro ( VCO)

The complete list of Chilean ADRs trading on the US markets can be found is here.

Disclosure: Long BCH and ITCB