Markets
How Every Asset Class, Currency, and Sector Performed in 2019
Another year is in the books, and for investors 2019 was quite the turnaround story.
Despite an early backdrop of heightened volatility, escalating trade tensions, Brexit uncertainty, and calls for a recession, the year progressed in an unexpectedly pleasant fashion. The Fed used its limited arsenal to provide additional stimulus, and global markets soaked it up to extend the decade-long bull run.
By the end of 2019, every major asset class was in the black — and the S&P 500 surged to finish with its best annual return since 2013.
Markets Roundup for 2019
Let’s take a look at major asset classes in 2019, to see how they fared:
Note: all indices here (i.e. S&P 500, Russell 2000, etc.) are using total returns, with dividends re-invested.
The first thing you’ll notice when looking at the above data is that every major asset class had a positive return for the year. The only real difference lies in the magnitude of that positive return.
Even though stocks experienced some of the best gains on the year, the winning asset may be a surprising one: crude oil.
The oil price (WTI) started the year at about $46/bbl and it closed the year at over $61/bbl, good for a 34% gain. And with escalating tensions between the U.S. and Iran, energy prices could be shooting even higher in 2020.
Performance by S&P 500 Sector
Strangely enough, rising oil prices did not do enough to buoy energy stocks — the poorest performing S&P 500 sector.
Although oil was up on the year, natural gas actually fell in price by about 26% in 2019. This effectively cancels out the gains made by oil, putting energy producers at the bottom of the list:
Not surprisingly, technology stocks excelled in 2019.
Tech was led by a big bounceback from Apple, a big winner that gained more than 80% over the course of the year. Other strong sectors in the benchmark U.S. index included communication services and financials.
The Currency Game
Now let’s look how currencies moved in 2019.
Below movements are all against the U.S. dollar, with the exception of the U.S. dollar itself, which is measured against a basket of currencies (U.S. Dollar Index):
The biggest currency mover on the year was the Canadian dollar, which jumped over 5% partially thanks to rising oil prices. Meanwhile, the biggest decrease went to the euro, which fell over 2% against the U.S. dollar.
It’s also worthwhile to note that Bitcoin had a particularly strong rebound in 2019, rising over 90% against the U.S. dollar.
Winners and Losers
Finally, we’ve put together a more arbitrary list of winners and losers for the year, incorporating all of the above and more.
Both the Greek and Russian stock markets had banner years, each returning close to 50% in dollar terms. Faux meat brands also captured investors’ imaginations, with Beyond Meat leading the charge. Palladium was a standout commodity, gaining 59% on the year.
We’ve chosen energy stocks as a loser, since they were the poorest performing sector on the S&P 500. Meanwhile, Macy’s and Abiomed were two of the worst large cap stocks to own in 2019.
Energy
The Periodic Table of Commodity Returns (2012-2021)
Energy fuels led the way as commodity prices surged in 2021, with only precious metals providing negative returns.
The Periodic Table of Commodity Returns (2022 Edition)
For investors, 2021 was a year in which nearly every asset class finished in the green, with commodities providing some of the best returns.
The S&P Goldman Sachs Commodity Index (GSCI) was the third best-performing asset class in 2021, returning 37.1% and beating out real estate and all major equity indices.
This graphic from U.S. Global Investors tracks individual commodity returns over the past decade, ranking them based on their individual performance each year.
Commodity Prices Surge in 2021
After a strong performance from commodities (metals especially) in the year prior, 2021 was all about energy commodities.
The top three performers for 2021 were energy fuels, with coal providing the single best annual return of any commodity over the past 10 years at 160.6%. According to U.S. Global Investors, coal was also the least volatile commodity of 2021, meaning investors had a smooth ride as the fossil fuel surged in price.
| Commodity | 2021 Returns |
|---|---|
| Coal | 160.61% |
| Crude Oil | 55.01% |
| Gas | 46.91% |
| Aluminum | 42.18% |
| Zinc | 31.53% |
| Nickel | 26.14% |
| Copper | 25.70% |
| Corn | 22.57% |
| Wheat | 20.34% |
| Lead | 18.32% |
| Gold | -3.64% |
| Platinum | -9.64% |
| Silver | -11.72% |
| Palladium | -22.21% |
Source: U.S. Global Investors
The only commodities in the red this year were precious metals, which failed to stay positive despite rising inflation across goods and asset prices. Gold and silver had returns of -3.6% and -11.7% respectively, with platinum returning -9.6% and palladium, the worst performing commodity of 2021, at -22.2%.
Aside from the precious metals, every other commodity managed double-digit positive returns, with four commodities (crude oil, coal, aluminum, and wheat) having their best single-year performances of the past decade.
Energy Commodities Outperform as the World Reopens
The partial resumption of travel and the reopening of businesses in 2021 were both powerful catalysts that fueled the price rise of energy commodities.
After crude oil’s dip into negative prices in April 2020, black gold had a strong comeback in 2021 as it returned 55.01% while being the most volatile commodity of the year.
Natural gas prices also rose significantly (46.91%), with the UK and Europe’s natural gas prices rising even more as supply constraints came up against the winter demand surge.
Despite being the second worst performer of 2020 with the clean energy transition on the horizon, coal was 2021’s best commodity.
High electricity demand saw coal return in style, especially in China which accounts for one-third of global coal consumption.
Base Metals Beat out Precious Metals
2021 was a tale of two metals, as precious metals and base metals had opposing returns.
Copper, nickel, zinc, aluminum, and lead, all essential for the clean energy transition, kept up last year’s positive returns as the EV batteries and renewable energy technologies caught investors’ attention.
Demand for these energy metals looks set to continue in 2022, with Tesla having already signed a $1.5 billion deal for 75,000 tonnes of nickel with Talon Metals.
On the other end of the spectrum, precious metals simply sunk like a rock last year.
Investors turned to equities, real estate, and even cryptocurrencies to preserve and grow their investments, rather than the traditionally favorable gold (-3.64%) and silver (-11.72%). Platinum and palladium also lagged behind other commodities, only returning -9.64% and -22.21% respectively.
Grains Bring Steady Gains
In a year of over and underperformers, grains kept up their steady track record and notched their fifth year in a row of positive returns.
Both corn and wheat provided double-digit returns, with corn reaching eight-year highs and wheat reaching prices not seen in over nine years. Overall, these two grains followed 2021’s trend of increasing food prices, as the UN Food and Agriculture Organization’s food price index reached a 10-year high, rising by 17.8% over the course of the year.
As inflation across commodities, assets, and consumer goods surged in 2021, investors will now be keeping a sharp eye for a pullback in 2022. We’ll have to wait and see whether or not the Fed’s plans to increase rates and taper asset purchases will manage to provide price stability in commodities.
Technology
Apple’s Colossal Market Cap as it Hits $3 Trillion
Apple’s market cap recently hit $3 trillion. To put that scale into context, this visualization compares Apple to European indexes.
Creator Program
Apple’s Colossal Market Cap in Context
In January of 2019, Apple’s market capitalization stood at $700 billion.
While this was perceived as a colossal figure at the time, when we fast forward to today, that valuation seems a lot more modest. Since then, Apple has surged to touch a $3 trillion valuation on January 3rd, 2022.
To gauge just how monstrous of a figure this is, consider that Apple is no longer comparable to just companies, but to countries and even entire stock indexes. This animation from James Eagle ranks the growth in Apple’s market cap alongside top indexes from the UK, France, and Germany.
Let’s take a closer look.
Apple Takes On Europe
The three indexes Apple is compared to are heavyweights in their own right.
The FTSE 100 consists of giants like HSBC and vaccine producer AstraZeneca, while the CAC 40 Index is home to LVMH, which made Bernard Arnault the richest man in the world for a period of time last year.
Nonetheless, Apple’s market cap exceeds that of the 100 companies in the FTSE, as well as the 40 in each of the CAC and DAX indexes.
| Stock/Index | Market Cap ($T) | Country of Origin |
|---|---|---|
| Apple | $3.00T | 🇺🇸 |
| FTSE 100 | $2.90T | 🇬🇧 |
| CAC 40 Index | $2.76T | 🇫🇷 |
| DAX 40 (Dax 30) Index* | $2.50T | 🇩🇪 |
*Germany’s flagship DAX Index expanded from 30 to 40 constituents in September 2021.
It’s important to note, that while Apple’s growth is stellar, European companies have simultaneously seen a decline in their share of the overall global stock market, which helps make these comparisons even more eye-catching.
For example, before 2005, publicly-traded European companies represented almost 30% of global stock market capitalization, but those figures have been cut in half to just 15% today.
Here are some other approaches to measure Apple’s dominance.
Apple’s Revenue Per Minute vs Other Tech Giants
Stepping away from market capitalization, another unique way to measure Apple’s success is in how much sales they generate on a per minute basis. In doing so, we see that they generate a massive $848,090 per minute.
Here’s how Apple revenue per minute compares to other Big Tech giants:
| Company | Revenue Per Minute |
|---|---|
| Amazon | $955,517 |
| Apple | $848,090 |
| Alphabet (Google) | $433,014 |
| Microsoft | $327,823 |
| $213,628 | |
| Tesla | $81,766 |
| Netflix | $50,566 |
Furthermore, Apple’s profits aren’t too shabby either: their $20.5 billion in net income last quarter equates to $156,000 in profits per minute.
How Apple Compares To Countries
Lastly, we can compare Apple’s market cap to the GDP of countries.
| Country (excluding Apple) | Total Value ($T) |
|---|---|
| Apple | $3.0T |
| Italy | $2.0T |
| Brazil | $1.8T |
| Canada | $1.7T |
| Russia | $1.7T |
| South Korea | $1.6T |
| Australia | $1.4T |
| Spain | $1.4T |
| Mexico | $1.3T |
| Indonesia | $1.1T |
What might be most impressive here is that Apple’s market cap eclipses the GDP of major developed economies, such as Canada and Australia. That means the company is more valuable than the entire economic production of these countries in a calendar year.
That’s some serious scale.
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