Key insights
- The author suggests a portfolio strategy of allocating funds to both the energy and technology sectors due to their perceived negative correlation. Historical data from 2016-2025 is presented, showing the performance of energy, technology, a 50/50 portfolio, and the S&P 500. The author claims the portfolio outperforms the S&P 500. However, this is a single, unsophisticated analysis and should not be taken as investment advice.
What do you think? If you just go energy and tech - they seem to be negatively correlated.
The data is not fully in for 2026, but the same trends seem to be continuing.
Obviously I don't know if it will keep going like this forever, but it looks like there is a trend.
|Year|Energy|Technology|Portfolio|S&P 500| |:-|:-|:-|:-|:-| |2016|25.3%|26.6%|25.9%|9.5%| |2017|0.9%|30.9%|15.9%|19.4%| |2018|-18.7%|12.1%|-3.3%|-6.2%| |2019|10.0%|43.1%|26.6%|28.9%| |2020|-20.0%|68.2%|24.1%|16.3%| |2021|69.2%|23.5%|46.4%|26.9%| |2022|55.8%|-30.7%|12.5%|-19.4%| |2023|16.0%|41.9%|29.0%|24.2%| |2024|9.3%|37.4%|23.4%|23.3%| |2025|23.0%|20.6%|21.8%|16.4%| |CAGR|14.0%|24.6%|21.6%|12.9%|
backtester used: https://atlantisdatasolutions.com/backtester