US real estate shares were the big winner for the major asset classes in December and for 2021 overall, based on a set of ETFs. Although several corners of risk assets rallied last month and for the year, real estate investment trusts (REITs) left the competition in the dust.

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Vanguard US Real Estate (VNQ) surged 9.5% in December, leading a broad rebound in global markets following the previous month’s rout. Last month’s rally lifted VNQ to a record high and helped catapult the fund to first place for 2021 performance – a red-hot 40.5% total return.

Although US REITs stole the show for performance among the major asset classes last year, 2021 was still kind to risk assets generally. The second-best performer in 2021: US stocks via Vanguard Total US Stock Market (VTI), which rallied 25.7% over the past 12 months.

Commodities had a strong year, too. The combination of a global economic recovery and an sharp runup in inflation helped lift WisdomTree Enhanced Commodity Strategy Fund (GCC) by nearly 20% last year.

Fixed-income securities were the main losers in 2021. The biggest setback: bonds issued by governments in emerging markets. VanEck Vectors JP Morgan EM Local Currency Bond (EMLC) tumbled 9.7% last year.

A notable exception to the downside bias for bonds in 2021: inflation-indexed Treasuries. The iShares TIPS Bond ETF (TIP) rose nearly 6% last year, offering a conspicuous counterpoint to the generally lower prices in bonds elsewhere.

The Global Market Index (GMI) posted a strong 14.0% total return for 2021.  This unmanaged benchmark (maintained by CapitalSpectator.com), which holds all the major asset classes (except cash) in market-value weights ended the year at slightly below a record high.

Reviewing GMI’s performance relative to US stocks and bonds over the past year reflects a robust middling performance for this multi-asset-class benchmark (blue line in chart below). US stocks earned nearly 26% in 2021. By contrast, a broad measure of US bonds — Vanguard Total US Bond Market (BND) — lost ground for the year just passed, edging down 1.9%.