The dismal global market performance of 2016 provides some pain for investors, but also opportunity. As of February 16^th, the TSX is down roughly 5% on the year for reasons the investor has become all too familiar with such as oil price volatility and concerns over a China slowdown. The CBOE Volatility Index, or ‘VIX’, which helps gauge U.S. market anxiety levels, is up 28.2% YTD. A higher VIX means greater expected volatility. So what were some of the best investments so far this year? Gold. 

Eight of the 10 best performers YTD have been gold or precious metal stocks with an average return of 45.7%.

Over the past month, gold futures have spiked 9.0%. Gold is an asset class that has been overlooked by investors and to a certain extent, it’s easy to see why. Gold has been in a 4+ year bear market ever since peaking at $1,921 on September 2011.

It currently trades just shy of $1,200. Further, gold is often thought of as a ‘rainy day’ provision and who likes to think of gloomy weather when most investor portfolios have performed well since the end of the Great Recession? Hindsight of course is 20/20.

Those investors who were able to maintain a diversified portfolio with an appropriate allocation to assets that exhibit ‘flight to safety’ qualities such as gold, were likely better off than the average investor.   

Shifting our focus to the worst performers, some may be surprised to see the diversity of sectors represented and not a complete dominance of energy names. Energy is the highest frequency sector at three names. Healthcare is a sector that has also made the list in the form of Prometic Life Sciences (PLI) and Concordia Healthcare (CXR). 

There is little the investor can to do hide from the panic and broad market losses we are seeing lately. However, by ensuring your portfolio is properly diversified and that no one name or sector dominates your exposure, you can certainly alleviate some pain.

Performance of safe-haven assets like gold, or even defensive sectors such as utilities or consumer staples are not going to shoot the lights out year over year but on those rainy days, they will help weather the storm and increase the chances you see some wins in your portfolio.