Looking back for a moment, 2019 was another stellar year for both equity and bond investors. In fact, it was the second best year for the S&P 500 since the financial crisis, rising 29%. And for tech investors, the NASDAQ 100 recorded its best year since 2013, rising nearly 40%, led by Microsoft and Apple, which both ended the year with market-caps greater than US$1 trillion.

Major equity markets outside the US were also very strong and many posted double digit returns, but for the most part did not keep pace with the US. The MSCI All World ex USA was up 18.9% for the year.

Meanwhile, bond investors flourished too as central banks – in the face of slowing global growth and geopolitical uncertainty – cut interest rates. In the US, the Federal Reserve cut rates for the first time since the financial crisis and the European Central Bank restarted its bond-buying programme. By the end of the year, the US 10-year government bond yield had fallen nearly 80 basis points, while in Europe, yields on German, Swiss, French and Dutch bond yields did the once- thought-impossible, falling into negative territory.

Down under, the New Zealand stock market was one of the few to keep pace with the US, with the NZX 50 rising more than 30% thanks to strong gains in defensive dividend- paying stocks. And bond investors thrived too as the Reserve Bank of New Zealand cut the Official Cash Rate to a record low 1%, citing falling demand for domestic goods and services and offshore uncertainty. Across the Tasman, the ASX 200 lagged, but still posted solid gains of 18.4%.

Of note, listed property stocks soared, benefiting in the low-interest-rate environment, making cash-flow-steady assets an attractive investment.

But, as we look ahead, 2020 is shaping up as yet-another important year …