Courtesy of Macquarie Research, this chart shows global asset returns so far in 2015, priced in US dollars.
The first thing that stands out is that there’s been no true standout performer. The Nikkei has been the only asset class to return over 10%, leading what is a small number of assets that have enjoyed a positive performance year to date.
The second thing that jumps out at you immediately in the performance of industrial metals. All have fallen so far in 2015, led by weakening demand from China and US dollar strength, they’ve had a torrid year.
For those in Australia, yes, that’s iron ore leading the worst performers list, losing in excess of 40% so far in 2015. Clearly it’s not the perfect time to be making your maiden iron ore shipment after outlaying billions in capital to produce it.
Energy assets also endured a tough year, although they still outperformed precious metals which have been battered by the triple whammy of US dollar strength, no yield and persistent disinflationary pressures in most parts of the world.
It will be more than interesting to see how this chart ends the year, particularly should the US Federal Reserve follow through with a rate hike for the first time in nearly a decade later this month.