Volatility mars your January returns

Article Excerpt

The year started with a bang as market volatility spiked. The killing of Iranian General Qassem Suleimani by U.S. forces, the rocket attack on a U.S. military camp in Iraq, the signing of a Phase 1 trade deal between the U.S. and China, and the rapid spread of a coronavirus originating from China’s Wuhan all contributed to the increase in volatility. The Chinese stock market, commodity producers, shipping companies, airlines, and luxury goods sellers all came under heavy pressure as investors started to factor in the negative impact on companies affected by the virus outbreak in China. The SPDR S&P Oil and Gas ETF (XOP) lost 19.2% during the month of January, the Invesco Shipping ETF (SEA) lost 18%, the Global X Copper Miners ETF (COPX), 13.9%, and the iShares China Large-Cap ETF (FXI), 8.9%. At the broad market level, the Vanguard Total World Stocks ETF (VT) lost 1.4%, the Vanguard S&P 500 ETF (VOO) was unchanged and the iShares MSCI Canada Equity ETF (EWC) lost 0.7%. Among the smaller markets, iShares MSCI Chile ETF (ECH) lost 8.0%…

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