Monthly Outlook: April 2017 It was a very good first quarter with solid gains coming from the global equity markets. U.S. stocks (Russell 3000) gained 5.6% though they stalled in March with a 0.1% gain. International stocks (MSCI EAFE) were the star of the quarter with a gain of 7.8%. On the other hand, stability assets (bonds) did their job to reduce volatility but acted as an anchor to diversified portfolio returns. The Barclays Aggregate bond index was only up 0.7% for the quarter. Lastly, commodities lost 3.0% and REITs gained a modest 0.9%. We sold these two small positions in March as a result. All in all, we had a good quarter and captured some nice upside. Within each portfolio’s equity allocation, we are now almost fully invested because the trends remain “up.” Don’t fight the trend! We are optimistic these uptrends will continue for now and we expect [...]

Monthly Outlook: March 2017 Equity markets have floated steadily higher since the U.S. presidential elections four months ago. While this has surprised about half of the people, it shouldn’t come as too big of a surprise that promises of tax cuts, de‐regulation, and fiscal stimulus are sweet music to investors’ ears. But as last night’s state of the union address made clear, there are precious few details to suggest that any of these promised changes will happen quickly. While the exuberance can continue without details, at some point investors are likely to pause and reconsider the facts. While a small pullback in stock prices is likely, we are far from any major sell signal or reversal of the current uptrend. That’s the state of the markets as we enter into March. February was another good month for us. Our growth assets provided above average returns. U.S. stocks (Russell 1000) gained [...]

Monthly Outlook: February 2017 Markets are off to a good start this year and our portfolios are participating with gains. Growth assets did their part, providing gains across the board. U.S. stocks (Russell 1000) gained 2.0% in January while international stocks (FTSE All‐World ex USA) did even better with a healthy gain of 3.4%, mostly from Japan and emerging markets. Commodities and REITs were mostly flat. Stability assets were, indeed, stable but lackluster. Intermediate term bonds (Barclays Aggregate) contributed just 0.1% in January, but short‐term bonds did a bit better with 0.3% returns. So bonds added much‐needed stability, but held back portfolio returns. All in all, depending on your objective and mix, globally diversified portfolios are up 1% to 2% in the first month. This is the best January since 2013, when our iFolios Growth model annual benchmark return was 12.5%. We can’t promise these returns for 2017, but it’s [...]

Monthly Outlook: January 2017 With every new year, we naturally have feelings of new beginnings, optimism and hope. We learn from our mistakes, promise to never make them again, and aim to be our best selves. With all of that, comes the urge to make predictions and show how enlightened and clued‐in we are. Well, if we learned anything in 2016, it’s that polls and predictions can be wrong! Brexit, Trump, Chicago Cubs – all proved that you can’t always foresee the future until it unfolds. So my only prediction for 2017 is this: Most predictions will be wrong, expect disruptions and unexpected outcomes, and stay flexible in your world view and certainly in your investments. There will be winners and losers and don’t think that you already know who they are. Before we move on to 2017, let’s review the numbers. U.S. stocks experienced a down‐up year, first diving [...]

Monthly Outlook: December 2016 Wow, what an election. It’s been three weeks already since the election and the world is still abuzz trying to figure out what it all means. The knee‐jerk reaction in markets so far has been to boost Financials, Energy, and Industrial stocks because investors are guessing that Trump will de‐regulate banks, allow more drilling, and initiate massive infrastructure projects. On the other hand, Healthcare, Staples, and Utilities are decidedly down. All in all, the S&P500 is up just 2.75% since the election (the news makes it sound like it’s up more, doesn’t it?). Additionally, interest rates shot up with the 10‐year U.S. Treasury moving from 1.8% pre‐ Trump to 2.3% today. That has pushed bond prices down 2.4% (prices and interest rates always move in opposite directions). I suppose investors figure the Trump policies will stimulate massive GDP growth and require lots of new debt to [...]

Monthly Outlook: November 2016 Markets are on hold for the next week waiting upon the election results. But what happens the day after? Either Clinton or Trump will be President and half of the country will be angry and in denial. Regardless of your politics, how can that be constructive for growth, jobs, stability, and yes...investments? We’re all so focused on who will win and how the big showdown will be resolved. Maybe we’re missing the point – the real work and struggle likely begins 11/9 (the day after the election). That’s a scary Halloween thought. October brought a few key changes to markets. Bonds finally had a slightly losing month, slipping nearly 1% (‐0.94%). The 10‐year interest rate popped up from 1.61% to 1.83%, nearly 1⁄4%, in anticipation of a much telegraphed Federal Reserve 1⁄4% rate hike coming in either November or December. Higher rates are good for the [...]