Important information - investment values and income from investments can go down as well as up, so you may get back less than you invest. Past performance is not a reliable indicator of future returns.
Most investors know that diversification is important. But it isn’t always obvious why, particularly when one market or type of investment seems to be doing better than everything else.
More experienced investors may already be familiar with the ‘Smarties’ table below, appropriately named because of its brightly coloured blocks.
It shows how 13 different asset classes and regional stock markets have performed each year since 2016. The strongest performer sits at the top of each column and the weakest at the bottom. All returns are shown in pounds.
Follow any colour across the table and one message quickly becomes clear: the winners keep changing.
The latest column, on the far right, covers the first six months of 2026. So far, it shows that Emerging-market, Asia-Pacific and Japanese equities all performed better than US equities. Every investment shown - apart from Bitcoin - also delivered a positive return.
Here are three simple lessons from the table, and what they could mean for you.
1. The US doesn’t always come out on top
US equities have performed strongly in recent years, helped in part by the growth of large technology companies and excitement around artificial intelligence (AI).
But they were not the strongest-performing market in the first half of 2026.
Emerging-market equities led the table with a return of 48.9%. Asia-Pacific equities followed at 45.9%, while Japanese equities returned 33.7%.
While US equities produced a strong return of 26.3%, they still finished behind several Asian and emerging markets.
This marks a change from 2023 and 2024, when US equities were among the top two performers. In 2025 and the first half of 2026, other markets moved ahead.
Demand linked to AI helped parts of Asia, including semiconductor and technology businesses in South Korea and Taiwan. Higher commodity prices may also have supported some exporters and mining companies in Latin America and South Africa.
- What’s the lesson? Strong recent performance does not mean a market will remain at the top. Avoiding too much reliance on one country or region can leave your portfolio better placed when market leadership changes, however, it will not remove the risk of losses.
2. Good returns were available in many places
Asian markets had a particularly strong start to 2026, but the gains were not limited to one part of the world.
Global equities returned 28.2%. European equities excluding the UK gained 22.9%, while UK equities returned 21.9%.
That may come as a surprise. The first six months of the year did not always feel positive. Investors faced geopolitical tensions, changing expectations for interest rates and continuing concerns about inflation.
Even so, positive returns were spread across a wide range of markets. Investors didn’t have to rely on a single country or region to find growth during the period.
- What’s the lesson? Headlines can make it feel as though all markets are moving in the same direction, but different regions and investments often behave differently. Holding a broad mix of assets can give you more than one source of return, although diversification cannot guarantee a profit or protect against losses.
3. Bigger gains can come with bigger falls
Bitcoin has often appeared near the top of the table.
It has taken first place in five of the eight years in which it’s shown. It returned 138.7% in 2023 and 124.4% in 2024.
But its position in the first half of 2026 tells a very different story. Bitcoin fell by 43.7%, making it the weakest performer in the table. It also fell by 59.7% in 2022.
These large moves are an example of volatility. An investment that can rise very quickly can also fall very quickly.
Other assets produced much smaller returns during the first half of 2026. Corporate bonds returned 6.2%, cash returned 4.0% and government bonds returned 1.1%.
These investments aren’t usually held in the hope that they will top a performance table. They may be included in a portfolio for different reasons, such as generating income, adding greater stability or reducing reliance on stock markets.
- What’s the lesson? The highest-returning investment is not always the most suitable. Different assets can play different roles, from supporting long-term growth to providing income or reducing the effect of market swings, so the right mix depends on your goals, timeframe and attitude to risk.
For more insight into the markets and themes that could shape the months ahead, read our latest Investment Outlook.
Important information - investors should note that the views expressed may no longer be current and may have already been acted upon. Overseas investments will be affected by movements in currency exchange rates. Investments in emerging markets can be more volatile than other more developed markets. Please be aware that past performance is not a reliable indicator of future returns. This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to one of Fidelity’s advisers or an authorised financial adviser of your choice.
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