The Best Performing Asset Class of 2017...

Will be known on December 31st, and probably not a day before.

Now, there is a big difference between knowing for sure what will happen and making forecasts and projections to help determine what is likely to happen. The problem is that it can be hard to tell what an article, story or sales pitch is really saying.

As everyone is well aware, there is no shortage of opinions these days and the investment world is no different. We see everything from full blown uninformed speculation on how unfolding economic and political events may impact the markets, to thoughtful and careful analysis to gain insights and build expectations to which asset classes we think will likely perform better than others. As with many things, some predictions are better than others, and at the end of the day, the market speaks and often moves in unexpected and unanticipated ways.

That unpredictability and inability to precisely determine the direction of the market is one of the strongest cases for diversification. Buy a little of everything and you'll get a nice blended average in the long run. Many mutual funds and exchange traded funds use this exact strategy. It is a very reasonable approach.

There have been many attempts to determine patterns in asset class returns over time, but few predictable reliable patterns emerge. Here is a grid of returns of some popular asset classes over the past 16 years. Do you see a pattern? Please let me know if you do. :-)

The point is that even though we can be fairly confident about some aspects of the economy and markets – such as interest rates rising in the short to medium term, we can't be 100% sure. We also don't know the magnitude or the impact of other factors, such as inflation.

So what do you do?

For our money and our client's money, we use our best judgment about what is most likely to happen and then align your investments with your willingness and ability to take risk. We invest for the long term. The process we use is personalized and updated periodically. Once you've built a diversified portfolio aligned to your risk tolerance, you can generally expect less volatility and you can confidently say that you've participated in that hot sector, whatever it may be and whenever it may be.

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- INVESTING AND INVESTMENT MANAGEMENT INVOLVES RISK, INCLUDING THE LOSS OF YOUR INITIAL INVESTMENT OR ANY INVESTMENT GAINS.

- PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.

- THIS GENERIC INFORMATION IS PROVIDED FOR EDUCATIONAL PURPOSES ONLY AND SHOULD NOT BE CONSTRUED AS A RECOMMENDATION FOR ANY INDIVIDUAL TO TAKE A SPECIFIC ACTION.

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- FINANCIAL PLANNING AND INVESTMENT MANAGEMENT SERVICES PROVIDED BY J. BRADFORD INVESTMENT MANAGEMENT, NASHUA NH.