Even "Perfect" portfolios underperform nearly half the time

ASSUME it is now December 1988. You scan all the stocks listed in Asia and in the US. You want to pick 10 stocks from Asia and the US which will perform the best over the next 30 years. Which stocks would you have picked? Chances are you wouldn't be able to spot these stocks initially.

The 10 best performers according to data from Refinitiv, formerly Thomson Reuters Datastream, are: YMG Trading from Hong Kong, Hanmi Science from Korea, Unilever Indonesia, Minor International from Thailand, Hap Seng Consolidated from Malaysia, China Resources Beer from Hong Kong, Samsung Electronics from Korea, Dutch Lady Milk Industries from Malaysia, Cosco Shipping International (Singapore) and Henderson Investment.

Had you put S$1,000 each in these 10 stocks, your S$10,000 would have grown to S$403,000, or an annual compounded return of 13.1 per cent a year. Including annual dividends in the last 30 years, the returns would be boosted by another 3.5 percentage points. In comparison, the MSCI Asia Pacific ex-Japan Index appreciated 4.1 per cent a year in Singdollar terms. With dividends reinvested, the total return came to 6.3 per cent a year.