Patchwork Chart of Investment Returns
Chart of the Week for January 30 - February 5, 2009
The chart of Investment Returns ranks key market indices, representing different asset classes, in order of calendar year performance. The asset class with the best calendar year performance is on top, and the asset class with the lowest calendar year performance is at the bottom of the chart. A top ranking does not mean the asset class produced positive returns. Using this table, we can make several observations about the market:
- The bond market, represented by the Barclays Capital U.S. Aggregate Bond Index, formerly known as the Lehman Brothers U.S. Aggregate Bond Index, was the top performing asset class in 2008. Its last appearance at the top was from 2000 to 2002.
- Cash, represented by the U.S. 30 Day T-Bill, after years of lagging performance, had the second highest rank in 2008. It was also near the top from 2000 to 2002.
- International stocks, represented by the MSCI EAFE Index, ended a 4 year run as the top performing asset class and ended 2008 as the lowest performing.
- Large-cap stocks, represented by the Russell 1000 Index, outperformed mid-cap stocks, represented by the Russell MidCap Index, from 2006 to 2008.
- Small-cap stocks, represented by the Russell 2000 Index, performed at the bottom of the performance spectrum in 2007, but was the 3rd best performer in 2008. However, the 2008 return for small stocks was still in negative territory.
This chart shows asset class rankings rotate in and out of favor depending on factors such as economic conditions and market sentiment. Investors should consider this rotation before investing too heavily in any single asset class.
| Index | 1999 | 2000 | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | 2007 | 2008 |
|---|---|---|---|---|---|---|---|---|---|---|
| Barclays Capital U. S. Aggregate Bond Index | -0.82% | 11.63% | 8.44% | 10.26% | 4.10% | 4.34% | 2.43% | 4.33% | 6.97% | 5.24% |
| U.S. 30 Day T-Bill | 4.68% | 5.89% | 3.83% | 1.65% | 1.02% | 1.20% | 2.98% | 4.80% | 4.66% | 1.69% |
| Russell 1000 Index | 20.91% | -7.79% | -12.45% | -21.65% | 29.89% | 11.40% | 6.27% | 15.46% | 5.77% | -37.60% |
| Russell MidCap Index | 18.23% | 8.25% | -5.62% | -16.18% | 40.06% | 20.22% | 12.65% | 15.26% | 5.60% | -41.46% |
| Russell 2000 Index | 21.26% | -3.02% | 2.49% | -20.48% | 47.25% | 18.33% | 4.55% | 18.37% | -1.57% | -33.79% |
| MSCI EAFE Index | 27.30% | -13.96% | -21.21% | -15.66% | 39.17% | 20.70% | 14.02% | 26.86% | 11.63% | -43.06% |
This illustration was compiled by information from outside sources. These companies are not affiliated with ICMA-RC. This information is being provided for educational purposes and is not intended to be construed as or relied upon as investment advice. ICMA-RC does not offer specific tax or legal advice. Individuals are advised to consider any new investment strategies carefully prior to implementing. Investment information can change rapidly and the changes can be significant particularly in volatile markets. For this reason “as of”’ dates are provided for specific data where applicable. The information should not be considered current after the dates provided.
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The performance data quoted represents past performance. Past performance is no guarantee of future results. Investment returns and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data illustrated. For performance data current to the most recent month end, contact ICMA-RC Services, LLC by calling 800-669-7400 or by writing to 777 North Capitol Street, NE, Washington, DC 20002-4240. Para asistencia en Español llame al 800-669-8216. Performance data current to the most recent quarter end is available by visiting www.icmarc.org.