2010 investment recap

Posted: December 31, 2010 in Economy

Reading the usual sources of financial news I see a number of those “best and worst” investments of 2010. Got me thinking. When they are waxing on about how strong U.S. equities performed I have a bit of a chuckle. The S&P 500 ended up all of 12% for 2010. Compare that to this chart of the SET100 (Stock Exchange of Thailand 100 index):

Yeah, it finished up 40% for the year. Add to that an 11% appreciation of the Thai baht versus the dollar, which you might consider if you happen to have dollar denominated investments. So I made 50% on my Thai equities investments (measured against the U.S. dollar) versus 12% on my U.S. equities. It is unfortunate that I still have dollar denominated investments. I have just been too slow dumping the failing currency.

My slow but steady approach has served me well over the years. Because of it I was only partially invested in equities when the market collapsed. At the time I was largely in cash. So I ended up looking like some kind of guru and suffered only a minor hit. But the steady decline in the value of the dollar ended up hurting me this year.

Then there is real estate. It’s such a different world here. While U.S. home prices continue to drift lower and something like 22% of homeowners are underwater on their mortgage (an amazing statistic), our land in Thailand doubled in value again this year. Demand has been strong and steady since we bought here six years ago. The western housing market collapse is truly in a different world. So a 100% investment performance for our real estate holdings. Again, it is unfortunate I didn’t dump more dollars and pick up more Thai real estate this year.

The future is always uncertain but it is pretty well expected that the U.S. economy will remain depressed next year and plenty more banks will fail along with unemployment above nine percent, while the Thai economy is expected to grow around 8% and the Thai government fights to keep the Thai bath from getting even stronger against the dollar.

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