Japan provides negative returns to investors over a 10-year period
A number of Japanese assets are among the most volatile investments over the past 10 years in Premier Fund Managers' updated performance and volatility tables for 2003.
Far East ex-Japan and Japanese Smaller Company investment trusts are in the most volatile category of investments, while Japan general funds and investment trusts and the Nikkei 225 index are in the worst-performing category.
The tables grade the main investment sectors from one to 10 in terms of annual returns and volatility, judged as standard deviation from June 1993 to June 2003 over the past 10 years. Money market and UK gilt funds are among the least volatile, while Nasdaq 100, European smaller companies investment trusts and technology & telecoms funds are the top performers.
The research is produced annually by Premier.
Jonathan Fry, joint managing director at the firm, said the Nasdaq and technology funds remain strong performers over 10 years despite the bursting of the technology bubble and three years of subsequent falls in equity markets.
He added: 'Conversely, despite the dramatic rises recently in the price of gold, it has been one of the poorest performing sectors, rising only 0.08%pa over the past 10 years.
'But risk and return go hand in hand and the volatility table shows a different picture, with the Nasdaq one of the most volatile and gold showing low to moderate risk.
'So the message to investors is simple: you cannot get high returns without taking risks and it is not enough to look at past performance in a vacuum without considering how it was achieved.'
Of the ten asset classes in the top two best-performing categories, four are also numbered among the two most volatile categories.
However the tables do point out a number of strongly performing asset classes with relatively low volatility ratings, including property funds, which ranked in the third-highest category for performance as well as in the second-least volatile category.
US equity indices scored well, with the Dow Jones Industrials index appearing in the top-performing category while making it into the fourth-least volatile table.
The S&P500 index performed almost as well, rating the same as the Dow Industrials for volatility while listed in the second-best category for performance.
Conversely, of the 10 worst performing asset classes, four were also among the two most volatile categories, including global emerging market investment trusts and funds.
Gold, while one of the worst performers, was also among the least volatile assets.
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