2013 has closed out. Let’s take a look at what happened.
- The S&P 500 had its best year since 1997
- Foreign Emerging Markets had negative returns
- Gold, precious metals and other commodities had a horrible year
- Interest rates came up a little, but didn’t get out of hand
- Inflation stayed comfortably low
If someone had told you this was coming as 2012 closed out, would you have believed them? Probably not.
The good news is that you don’t have to be able to predict any of this to have good investment outcomes. Let’s say you were an investor in 1993 (20 years ago) with absolutely no ability to make financial predictions, so you just put all your money in an S&P 500 index fund and hold on. Your total return would have been 542.33%. Long term, the simplest investment strategies are often the best.