As a self-directed investor, it can be challenging to avoid the constant noise of the latest and greatest moves in the industry. A sample of the kinds of things that have landed in my inbox lately will hopefully illustrate this point:

• “Single stock SpaceX ETFs are coming”
• “This 11% dividend is a screaming deal”
• “This divvie is the ultimate ‘pick and shovel’ play on Elon, Inc”
• “Should we have sold in May and walked away?”

The noise is nearly impossible to avoid; there always seems to be one company, one trend, one segment, one market, one product that’s just booming while your portfolio languishes.

What’s the reason this is so? Beyond the need for news sources to produce content, I mean? A peek at Blackrock’s “periodic table“¹ of market performance gave me an answer, maybe.

This table illustrates the performance of thirteen segments of the market on an annual basis. What is evident is that the “hot” segment keeps changing. What was hot last year rarely repeats this year. Take for example this year’s darling, Commodities. This index can be found over at https://www.investopedia.com/terms/c/crb.asp and tracks (among other things) the price of oil, gold, copper, wheat…and I’m sure you’ve noticed the recent uptick in ETFs covering this space (or a subspace):

• GlobalX has three new silver-focused ETFs (SLVX, SVCC, and SVCL) and three commodity producers ETFs (COMX, CMCC and CMCL)
• BMO launched a covered call gold bullion ETF (ZWGD.T) and a hedged broad commodity ETF (ZCOM.F) this year
• TD launched TCOM which looks like it’s achieving exposure to broad commodities markets through swaps and derivatives²

My sense is that all of these ETFs were launched in an effort to attract FOMO investors who are trying to ride the commodities wave this year. Commodities as a category aren’t a terrible thing to invest in, as the Annualized column shows — they have actually performed pretty decently over the past decade — but still behind US Equity, Emerging Market Equity, Japan Equity and European Equity indices.

There’s always going to be some segment that’s on fire in a given year. Predicting which segment that might be isn’t consistently possible, so my advice is to ignore the noise and don’t chase the latest shiny object. Over long periods of time, it’s hard to beat investing in boring index equity funds.

1. There’s a few of these kinds of tables floating about; a more Canadian-centric one can be found at https://www.stingyinvestor.com/SC/PeriodicTableofAnnualReturns.pl ↩︎
2. The “Investment Approach” linked here makes my head hurt ↩︎