News & Commentary

Vanguard’s 2010 Index Chart 31 Aug 10

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The 2010 Vanguard Index Chart highlights the performance of major asset classes over the past 30 years and is now available to order.

Over the years the Index Chart has been a popular client education tool for advisers. It offers perspective on the benefits of taking a long-term view and having realistic market expectations. The merits of asset diversification and having a watchful eye on market risk are two of the key messages that can be taken from this year’s Index Chart. As well as highlighting asset class performance, the Index Chart signposts key economic, social, political and demographic changes and events that have impacted markets.     

The Index Chart shows that over the past 30 years positive returns have outweighed negative returns across all major asset classes, as markets have trended upwards. For example, since 1980 Australian shares have delivered positive returns in 24 out of 30 financial years, returning an average annual return of 11.1 per cent to June 2010.  

The chart depicts the cyclical nature of investment markets, as well as how asset classes perform at different times and can have inverse relationships. Having a portfolio which holds a broad range of asset classes, sectors and securities ensures an investor is well positioned to capture market growth, while helping to moderate return volatility over time. Ultimately no one can predict the future, which is why investing based on short-term performance can be a dangerous strategy compared to taking a diversified long-term approach.

To order a hard copy, or download the 2010 Index chart, click here.

 

 

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