What Is The Best Asset Class in 2022?

2021 was a great year for energy stocks and large-cap stocks. In 2020 small-cap stocks dominated.

Which asset class will dominate this year?

So what is the best asset class in 2022?

The best returning asset class in 2022 is: Energy with a 39% return so far for the year.

Article contents

What is the return of all the other asset classes for 2022?

We track 61 asset classes which is a lot more than the usual overview of asset classes. We are inspired by William Bernstein who favors many asset classes.

Below you can see how other asset classes have performed in 2022.

Portfolio data was last updated on 11th of August 2023, 08:35 ET

Asset ClassYTD20212020
Total US Market-19.5125.6721.03
Large Cap Value-2.0726.512.26
Large Cap Blend (S&P 500)-18.1928.7818.29
Large Cap Growth-33.1527.3440.22
Mid Cap Value-7.9528.76-4.13
Mid Cap Blend-13.1424.7113.58
Mid Cap Growth-19.0318.6822.44
Small Cap Value-11.3830.632.79
Small Cap Blend-16.2726.7411.47
Small Cap Growth-21.3222.3719.22
Micro Cap-21.9318.6820.88
Real Estate-26.2440.52-4.68
International Developed-15.3611.679.74
Emerging Markets-17.991.315.19
Total International-15.598.2811.12
International Pacific-15.21.1216.67
International Europe-16.0116.885.45
International Value-5.1811.1-2.97
International Small-21.4713.0711.84
Long Term Treasury-31.24-4.618.15
Intermediate Term Treasury-10.53-2.647.71
Short Term Treasury-3.86-0.63.04
Total Bond Market-13.11-1.867.71
Short Term Govt/Corp Bond-5.62-0.635.13
T-bills/Treasury Money Market1.4-0.10.4
Inter. Term Corporate Bond-17.93-1.8410.97
Energy Sector64.1753.31-32.51
Health Care Sector-2.0926.0413.34
Precious Metals Sector-0.25-9.629.52
Short Term Tax Exempt Munis-
Inter. Term Tax Exempt Munis-
Long Term Tax Exempt Munis-13.162.375.06
Short Term Investment Grade-5.62-0.635.13
High Yield Corporate Bonds-10.993.754.48
Treasury Inflation-Protected - TIPS-2.965.364.95
Global Bonds-12.88-2.16.22
International Bonds-12.76-2.284.65
Extended Market-26.5112.332.43
Total World Market-18.0118.2716.61
Momentum Factor-18.2613.3729.85
Quality Factor-20.4926.9317.03
Minimum Volatility Factor-9.4220.845.64
Value Factor-14.1628.94-0.24
Dividend Growth-9.8123.7615.4
High Dividend Yield-0.4626.211.14
International Small Value-17.3411.7-1.33
Emerging Markets Small Blend-15.018.1614.86
Emerging Markets Value-15.5514.4-2.79
One-Year Fixed-Income-5.49-1.094.7
Two-Year Global Fixed-Income-12.88-2.16.22
Five-Year Global Fixed-Income-12.88-2.16.22
Emerging Market Bonds-17.41-1.815.66
Long Term Investment-grade Bonds-25.52-1.7413.28
International REITs-22.945.9-7.21
Stocks Canada-5.7925.664.81
Bonds Canada-11.88-2.898.59
Global REIT-24.0732.42-10.55
MBS Mortgages-11.9-1.283.76
Preferred Stocks-
Performance for Asset Classes

To see which ETFs you should buy to gain exposure to an asset class we got you covered.

The best asset class in our dataset is healthcare. We have data going back to 1989 for most of our asset classes and since 1989 healthcare has been the top performer.

The reason why healthcare is so good could be because healthcare is very much top of mind for us humans. We care a lot about our health – we don’t want to die. In order for us to prevent this, we invest and spend heavily on healthcare services and products.

What is the worst asset class?

The worst asset class in our dataset is commodities. We have data going back to 1989 for most of our asset classes and since then healthcare has been the top performer.

The reason why commodities is such as bad asset class could be because of human ingenuity. We keep getting better at optimizing our use of raw materials. At the same time, we keep finding replacement materials for raw materials that have become scarce.

Another reason is that commodities are well…a commodity. There is plenty of competition and it is hard to protect one’s business with a moat in the commodity business, so prices tend to race to the bottom unless demand picks up, which it does in boom times……and then they plummet in bust-times just when producers have ramped up production exacerbating the price decline due to overproduction.

Does anyone remember peak oil?

Should I invest everything in the best asset class?

Our data goes back to 1989 so we have some 30+ years to base our conclusions on. We can’t predict which asset class will do better in the next 30 years. It is entirely possible that one asset class will dominate for decades and then fizzle out. The reverse is also true.

You only have one lifetime in which to invest, however, so while one asset class or another has shown superior performance, we find it unwise to bet the farm that the same asset class will continue its outperformance in those exact same years when YOU need it to.

Therefore we encourage you to build a diversified portfolio and tilt your portfolio towards high-performing asset classes that historically have shown the ability to perform.

At the same time, we also encourage that you avoid the worst asset classes like commodities.

Suggestions for your next steps

If you have already committed to a portfolio then maybe you need help maintaining the portfolio. In this case you will find our rebalance worksheet useful.

Rebalancing your portfolio lowers your risk and may provide higher returns in the long run. It is completely FREE.

You can find the rebalance worksheet in our article Here Is The Most Easy To Use Portfolio Rebalance Tool.