I think it's fair to say that 2019 has been a year of 'macro-trends'. Given we are still in what is being called the longest bull-run in history, there has been a lot of focus on the 'next recession' this year. A wide range of indicators have been cited by experts throughout the year, all of which at various points seemed to indicate a looming market crash.
Remember the 'yield curve inversion'? Or the rise of the gold price to its highest level in 8 years? Or maybe the US Federal Reserve's infamous 'pivot' at the start of the year? On a closer-to-home basis, we were told that the 'new Labor government' would smash house prices, cut franking credits and wreck the economy.
All of these things were heralded as defining moments that indicated we should 'sell out now' and avoid the coming recession. We won't even mention the US/China trade war, Donald Trump's impeachment or any of the President's erratic actions/tweets.
Of course, all of these things didn't stop the markets from banking a bumper year of returns. The S&P/ASX 200 (INDEXASX: XJO) is on track to finish the year with a ~25% gain (including dividends), close to its record high and just short of the psychologically important and untouched 7,000 points mark.
ASX growth companies like Afterpay Ltd (ASX: APT), Altium Limited (ASX: ALU) and Xero Limited (ASX: XRO) spent the year consolidating their products, brands and scale – rewarding investors with double-digit share price growth (triple-digit in Afterpay's case).
Even strong-and-silent Aussie ASX blue-chips like Telstra Corporation Ltd (ASX: TLS), Woolworths Group Ltd (ASX: WOW) and Wesfarmers Ltd (ASX: WES) banked huge gains for their investors.
What really matters, then?
All this tells me one thing – it's the idea of ownership of businesses that's the only thing that really matters.
Sure, yield curves, commodity prices and the general state of the economy are important. But at the end of the day, buying shares is buying an ownership of a company, a business. The only thing that makes a difference, in the end, is how that business makes money and whether it will continue to do so at an increasing rate.
Are Afterpay's customers turning away from the company's platform because of a 'yield curve'? No way!
Are people going to stop using Telstra's mobile network or shopping at Woolworths because the gold price moves up? I doubt it!
Foolish Takeaway
It's easy to get lost in the avalanche of opinion and information we are subjected to everyday as investors. That's why I think going back to basics and looking at the businesses you own in your portfolio would be very beneficial as we head into 2020.
