By Adinah Brown
It’s time to look back at the recent past. Since the GFC decimated the world economy in the late noughties, US share markets have been in an almost constant bullish state. Were you brave when others were fearful? Did you buy when blood was in the streets? Or did you double down on a high leverage housing position? Or perhaps you went long on Radio shack?
Whatever you did, it’s time to look at some the best and worst investments you could have been made. It’s kind of like Santa’s naughty or nice list, but at the end you don’t get any eggnog.
It’s a pretty high bar here, with the S&P at 250% since the low with reinvested dividends. If we look at the sectors which did the best between March 2009 and March 2017, Consumer Discretionary was up 522%, followed by Financials, Industrials, IT, and healthcare rounding out the top 5 at 301% increase.
For individual shares there are a few interesting companies that come up.
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One is GGP Inc, a REIT focusing on retail and master planned communities that has seen both the highs and the lows. Hit hard by the GFC, its 10 year return is actually -36%, but since March 2009, has posted more than a 9000% turnaround.
More stable is Incyte Corp, a biotechnology company focusing on oncology therapeutics, posted a 6300% increase from the lows. It had long been a strong performer, with returns of over 2000% for 10 years, and 100% over the last 15 years.
Non US share trades
Even though the US started this whole mess, the rest of the world was affected significantly too. But some great trades that could have been made have come from some unlikely candidates.
Bitcoin, first mined in January 2009, was tradable in 2010 at 5 cents per bitcoin. At the end of last week it closed at an all-time high of $3,300. Other cryptocurrencies with shorter lifespans have also made significant returns. In fact its radical climb up the charts, makes the whole enterprise read like the pages of a sci-fi novel.
Now we get to the naughty list, and there are few surprises here, with the worst US stocks list including oil and gas, materials and just some very poorly run companies. Truthfully, a “worst performing” category is a misnomer because it can’t include all the companies that have disappeared due to colossal mismanagement or just got disrupted.
So let’s grit our teeth and have a look at some of the sectors that will live on in infamy as bad investments since 2009.
If you owned a taxi license or medallion in 2009, that was considered a solid, stable investment. But the recent influx of ride sharing companies like Uber and Lyft has not only impacted car ownership, it has had a huge impact on taxi services. Reports of New York taxi medallions selling for less than one fifth of their 2013 value, shows something that has been apparent for a while, that taxis are on their way out.
Going to a video store? That’s like, so 2009! In fact, it was probably so 2004, since blockbusters didn’t last much beyond 2009, filing for bankruptcy in September 2010 and closing its last stores in 2013. The saddest thing? It could have bought Netflix for only $50 million.
Did you cash out your shares after the drop in 2009? Maybe not the best idea. Leaving it in the US share market would have shown a rebound over 250%. Left in US dollars or cash equivalents since that time? About 1% to March 2017. And that’s not even taking into account the current devaluation against other currencies.
About the Author:
Adinah Brown is a professional writer who has worked in a wide range of industry settings, including corporate industry, government and non-government organizations. Within many of these positions, Adinah has provided skilled marketing and advertising services and is currently the Content Manager at Leverate.