justETF Market Watch – Review 3rd quarter of 2018

justETF.com

2018 has so far been a mediocre year for investors. While developed market equities returned good profits, emerging market equities and gold disappointed.

justETF Market Watch – Review 3rd quarter of 2018 justETF reports regularly on the latest market developments at the end of every quarter. This report aims to be a review of the latest market developments, as well as offering insights into the development of your investment strategy.

In the past quarter, only developed market equities could return profits. Despite emerging market equities being a drag for developed market equities in the last few months, equities as a whole managed to be the most profitable asset class of the third quarter of 2018. As usual, bonds showed little volatility over the entire quarter and were therefore helpful to reduce ups and downs for any portfolio they might be included in. Commodities suffered moderate losses and became the second weakest asset class during the past quarter. Gold suffered the highest losses since July and therefore became the weakest asset class.

 

Bonds

Over the course of 2018, bonds showed little volatility in total and fulfilled their role as low-risk assets. European government bonds as well as European corporate bonds could not yet reach black figures and returned small losses of -0.6 per cent, and -0.7 per cent respectively.

 

Equities

Developed market equities could once again increase their lead over other asset classes, especially over emerging market equities. While developed market equities returned +5.8 per cent in the third quarter of 2018, emerging market equities lost once again, returning -0.7 per cent despite notable gains in the second half of September.

Since developed market equities were spared from major adjustments since April 2018, they returned a considerable profit of +9.4 per cent YTD, while emerging market equities dropped down to -5.5 per cent YTD.

 

Commodities and gold

Since June 2018, days of profit were scarce for gold, resulting in it having the worst quarter of all asset classes. Between July and October, it returned -4.5 per cent, dropping down to -5.4 per cent YTD.

Commodities had a bad start in the third quarter of 2018, and could not mitigate their losses until the last weeks of September. Yet, commodities did not reach black figures and returned -1.8 per cent, becoming the second worst asset class of the past quarter. However, if the whole year is taken into account, commodities returned notable profits of +5.0 per cent YTD, and claimed second place, due to the weak competition.

 

Development of asset classes 2018 (01/01/2018 – 30/09/2018)

Development of asset classes in 2018
Compare asset classes in the chart
Source: justETF; As of 30/09/2018