With the benefit of hindsight …

The benefit of hindsight is one of the most dangerous luxuries in investing. Looking at a return table after the fact, everything looks obvious.

This table shows the total returns of major asset classes in USD since 2011. What is striking this year so far is how broad the rally has been: around 90% of asset classes are positive.

The leaders are not necessarily the ones most investors would have predicted at the beginning of the year: convertible bonds, commodities, and the Nasdaq 100 are at the top of the table. US small caps are also having a strong year.

On the other side, the main losers are gold and Bitcoin. This is particularly interesting because Bitcoin remains, since 2011, by far the best-performing asset class in the table, with an annualized return of more than 120%. But this performance has come with extreme volatility.

Asset allocation always looks easy in hindsight. In real time, it is much more difficult. The best-performing assets are often the hardest to hold, and the most obvious consensus trades are not always the best ones.

Diversification may sometimes look boring, but it always makes sense in investing.