Monthly Outlook: June 2018  U.S. stocks continue to mark time in May, stuck in a sideways, range-bound channel.  The S&P500 has been stuck at 2,700, give or take 100 points, for the past six months.  If the economy is so good, as evidenced by rising corporate earnings and full employment, then why can’t the stock market continue to advance?  Could it be that the barrage of tweets (from many people) and the constant cross-talk of tariffs and trade wars is just too confusing?  Perhaps CEOs and investors, alike, are unable to commit new capital, frozen with indecision.  More on this later, but let’s first review the markets. U.S. stocks (S&P500) had a decent gain in May, adding 2.4%.  But this market remains stuck at about 2,700 these past six months and is presently at 2,705.  For the past 100 trading days (which is close to YTD), the S&P500 has closed [...]

Monthly Outlook: May 2018  Global stocks have now stalled for the past five months as investors digest conflicting inputs.  On the positive side, corporate earnings continue to move higher, but so do interest rates (a negative).  Consumer confidence and employment are high, but so are valuations.  And although the S&P500 is exactly where it was five months ago, there’s been a lot of volatility and conflict along the way.  History shows us that stocks don’t move sideways for long.  We expect resolution soon and for a sustainable trend to develop.  The question is “which direction?”  Will the 9-year uptrend continue or are we about to enter a correction?  It’s also possible that the answer is “both.”  Some asset classes could trend higher while others sink.  That’s why we’re always vigilant and managing the mix in our iFolios.  We’ll discuss that in more detail later, but let’s review the markets first. [...]

Monthly Outlook: April 2018  The first quarter of 2018 was sure volatile but, in the end, there was very little change to the broad market indexes.  By a narrowing margin, the trends remain up, which means we remain invested.  Just like Colorado springtime weather, we’ve seen a lot of wind (volatility), but so far, no storm (new down-trends).  With each burst of nerve-wracking market volatility, it’s natural to feel unsettled and tempted toward rash action.  But the key to investing success is to stay disciplined with a steady, calm, and proven strategy that focuses on long-term trends for guidance.  Our iFolios strategy is just such a strategy and will keep us invested appropriately. U.S. stocks (S&P500) lost just -1.0% in the 1st quarter of 2018, but it took the long way to get there!  The S&P500 first rose 7.4%, dropped 10.1%, rallied 8.2% again, and then sagged 5.2%.  The key [...]

Monthly Outlook: March 2018 In case you didn’t notice, February was a bit of a wild ride for stocks.  The S&P500 peaked on January 26th, dropped 11% by February 9th, then rebounded 8% by February 26th.  That’s a very unusual and large amount of volatility for one month!  We’ll talk more about volatility and risk later in this Outlook.  First, let’s review market returns for the month and year to date. U.S. stocks (S&P500) lost -3.7% in February but are still up +1.3% YTD.  The strongest sectors continue to be Technology, Financials, and Consumer Discretionary (mostly Amazon!).  International stocks (FTSE All-world ex-USA) also had a yo-yo February and fell -5.3% for the month, but are up slightly, +0.1%, for the YTD.  Outside the U.S., it’s the Emerging Markets that show the most strength.  Lastly, let’s look at bonds.  Bonds (Barclays Aggregate Bond Index), are down -2.2% YTD and that includes [...]

Monthly Outlook: February 2018 We’re off to a strong start in 2018!  In fact, it’s been one of the best Januarys for stocks in the past 20 years.  Stocks are on a persistent more-of-the-same run these past few years.  Bonds are a different story, however. U.S. stocks (S&P500) gained +5.5% in January, led primarily by the “FANG” stocks: Facebook, Amazon, Netflix, and Google.  International stocks (FTSE All-world ex-USA) did just as well, gaining +5.7%, with emerging markets outperforming.  Clearly, stocks continue to pump higher and the long-term uptrends remain intact.  Bonds (Barclays Aggregate Bond Index), on the other hand, slumped in January due to the rise in interest rates.  The U.S. 10-year treasury rate rose from 2.40% to 2.72% in January.  That 1/3rd % rate rise doesn’t seem like much, but it’s enough for bonds (Barclays Aggregate Bond Index) to lose 1.24%, total return including interest.  This slump in bonds [...]

Monthly Outlook: January 2018 Happy New Year!  And who wouldn’t be in a great mood after the market returns we enjoyed in 2017?  Last year was the 9th year post-financial crisis, which makes this recovery one of the longest on record without a correction.  But as Newton showed us 300 years ago, an object in motion stays in motion until it meets an opposing force.  And so far, we just haven’t seen a big enough force to unsettle the party.  This “stays in motion” theme is, essentially, our outlook for 2018, which we’ll talk about later in this Outlook. Let’s review 2017 markets before we look ahead.  U.S. stocks (S&P500) gained +21.7% in 2017, led primarily by technology stocks.  International stocks (FTSE All-world ex-USA) did well, too, gaining 27.4%, with Europe, Asia, and Emerging all contributing evenly.  Bonds (Barclays Aggregate) did their part to add stability but only contributed a [...]