Where We Landed For 2022 • Chris Raper • January 6, 2023
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What follows is a recap as to where we landed for Aspira Wealth’s internally managed investment strategies for the year ended December 31, 2022. Please recall that most clients have a blend of these strategies.
To give you some market context, in 2022 all major indexes in Canada and US declined between 5.8% and 32.6%:
- S&P/TSX Composite (XIC.TO): -5.8%
- S&P 500 (SPY): -18.2%
- Nasdaq-100: (QQQ): -32.6%
- US Aggregate Bond (AGG): -13.0%
- Canadian Aggregate Bond (VAB.TO) -11.9%
- Canadian Preferred Shares (CPD.TO): -19.2%
In terms of bold predictions for 2023, I will refrain from making any market performance related prognostications. How the “experts” can do so with a straight face is simply beyond me. What I am very confident in is how investor behavior will play out for 2023:
- Like every year, there will be some scary periods and we will have a few clients who insist on selling and a few clients who will send us money during that time. Who do you think will do better?
- Some clients are going to look at the above numbers and start extrapolating them into the future – please do not do that! The returns in 2021 were phenomenal and for 2022, less spectacular on an absolute basis, but perhaps more so on a relative basis. That said, we remain focused on the long term and continue to advocate that you do the same.
- Some clients are going to resist our counsel of “building up the safe pile” as opposed to piling money into The Next Cycle Resource Fund. Let’s remember that the objective for the money should always rule the investment decision.
My final bold prediction for the future is that investor behavior will be the number one determinant of life time returns. That was true in 2022 and it will remain true every year hereafter. Our market counsel is built around this premise.
We will be back with The Quarterly Opportunity Update – 4th Quarter 2022 (audio/text editions) by the end of January 2023.
Chris Raper - Co-Founder, Senior Wealth Advisor, Cross Border
Joanne Kaban - Co-Founder, Financial Planner
Alex Vozian - Co-Founder, Associate Portfolio Manager
*Please note the figures do not include the returns from the non-discretionary side of your accounts. For most of our clients, this is the ultra-conservative side, i.e., the guaranteed investment certificates (GICs) and the high interest savings accounts (HISA). Obviously the latter will have the effect of smoothing household returns. Please be reminded they do serve an important purpose – they ensure that we don’t have to sell securities in a down market to meet your cash flow requirements.
*The above results are only applicable to those accounts we manage within the Raymond James Ltd. (Canada) platform. Our cross border clients who have accounts domiciled at Raymond James USA Ltd. will have different results, in large part due to currency swings.