“A weed is but an unloved flower.” - Ella Wheeler Wilcox
We closed out 2013 with a bifurcated market. US stocks were the only place to be while the balance of the choices vying for your investment dollar were either ignored or beaten like that spider you found in your clothes drawer. As you can see in the chart below (2013 asset class performance) stocks were the only investment that ended the year higher (red). Commodities (purple) squeaked out a small loss, US bonds (pink) were shunned losing double digits while gold (light blue) was crushed.
A funny thing happened (at least so far) once we flipped the page on the New Year. Through the first two months of the year it appears as if the 2013 losers have become this years darlings. Commodites and gold have outperformed stocks by almost 5x and bonds have also showed strength, doubling the returns of stocks.
While 2 months is not long enough to confirm a reversal of fortune, it appears as if 2014 is suggesting a US stock over-weighted portfolio, unlike the past 3 years, may not provide the best returns.