Best Performing Asset Class

This graph below from Chart of the Day illustrates the total return by asset class from 2010-2020 and YTD 2021. The returns are adjusted for inflation. It is no surprise that Equities have been the best performing asset out of the bunch. In an environment that systemic risk has been minimized, or so it seems, by FRB’s loose monetary policy, one would expect the best performing assets to be where the risk/reward is high. However, the opposite is also true: when sentiment becomes bearish, expect equities to fall the hardest.