Investment returns – Page 10

Feb ’24: Envyidia

2024-03-032024-03-03 FIRE v LondonLeave a comment

I’ve had quite a lot of culture to enjoy in February.

Aside from some travel for the Six Nations rugby, I’ve been to two shows – one in London’s Royal Opera House and one on the south coast.

Both events were either full or practically full. Covid feels fully behind us now. But the prices have stayed with us.

I was struck by the demographic difference between these two nights out. I know, I know, the demographics of opera and concerts are not a fully reliable guage. But I was practically the youngest person in the audience at Poole’s Lighthouse concert hall, whereas I felt 2nd quartile old in London’s Royal Opera House. Is this a reflection of where the money sits – with retirees only in Dorset, and with well-heeled workers and tourists in London? A rhetorical question, for now.

Markets in February 2024

The USA stock market continued to be the main story in February.

Though if you were paying attention, the Japanese market has been setting new records too – the Nikkei 225 is up 20% Year to Date.

It wasn’t just Japan that’s booming, with Asia ex Japan up 4.5% in February itself. Over in Europe and Australia we had much less excitement; Europe ex UK was up 2.8%, Australia up only 1.2% and the misery-guts UK’s market rose only 0.5%.

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Jan ’24: A giant tax bill lands

2024-02-10 FIRE v London1 Comment

One of several highlights for me in January was visiting Salisbury cathedral, which I did on an impulse while travelling back from the Coastal Folly.

My main frame of reference to the cathedral being those notorious Russian nerve agent assassins citing it as their reason for visiting England, something which to a Londoner had as much plausibility as as Putin’s claims that Ukraine’s Nazis started the war. I hadn’t taken seriously the idea that the cathedral might actually be a reason to visit England. But I would say I was wrong – it is stunning, and surprisingly moving. Photos really don’t do it justice.

Elsewhere in the world, the focus has shifted from the Ukraine war to the Gaza crisis – which has escalated to the Houthi shipping attacks off the Yemen.

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Dec ’23 – 2023 in review

2024-01-022024-01-03 FIRE v London8 Comments

It’s the start of a calendar year. Let’s take a look at what 2023 did to me financially. I’m following the same structure I’ve used for the last few years (2022, 2021, and 2020). Overall, 2023 was a good year on almost all measures – thanks in particular to Q4 which saw the US stock market drag the year into a top quartile performance.

Q1 How did markets do?

First of all, what happened out there? Well, the year felt pretty ‘meh’ for the first nine months – as illustrated by my rather depressed blog post in mid October. But almost as soon as I hit Publish, the US market in particular led a dramatic recovery – reflecting a sharply improved outlook for inflation and interest rates. You can see below firstly the performance in December.

*December 2023 market returns, by geography and asset class*

Then we get to the year as a whole. Bonds rose by 3-5% across the board, but equities did strikingly better – particularly in the USA where the S&P500 rose around 26%. The UK equity market looks like the runt of the litter, which given the tech-driven nature of the uptick and the lack of UK tech wouldn’t be a big surprise. However it isn’t quite that simple, because the GBP rose against most currencies.

*2023 market returns, by geography and asset class*

Another way to look at the benchmarks is to look at the world equities (e.g. VWRL) and world bonds (e.g. AGG/BND or the UK’s IGLT). My portfolio has often pretty closely tracked the VWRL ETF. The graph below shows VWRL and IGLT’s share prices (but not dividends) for the year, showing the world equity bundle up (in GBP) 13.4% and the UK government bond index roughly flat.