January 2019 – Market Commentary

January 2019 – Market Commentary

Disclaimer:  These are the views of Summit Financial Consulting and should not be construed as investment advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. 

SANTA CLAUS RALLY? YEAR-END MARKET COMMENTARY
Investors were hoping for what many people call a Santa Claus rally to end the year.  Since 1929, the market has been positive in December 72% of the time, and those numbers improve if you look at the last 10 and 20 years (Source:  https://seekingalpha.com/article/4225368-santa-real-monthly-seasonality-djia)

Unfortunately, this turned out to be a record-breaking year, but not in the way we were all hoping.  In the month of December the S&P 500 lost 9%, the DOW lost 8.7%, and the Russell 2000 small cap index lost 12%.  Many investors take note of the high point, and from the high point to the low point the S&P 500 dropped about 20%.

Now that 2018 has come to a close, we can also discuss the year end numbers. The Russell 2000, which is the top small-cap stocks in the US, lost 12.1% for the year. The S&P 500 lost 6.2% for the year, and the DOW lost 5.6%.  This was the worst year for stocks since 2008 and only the 2nd time the DOW and S&P 500 fell in the past decade.  Source:  https://www.cnn.com/2018/12/31/investing/dow-stock-market-today/index.html

Despite all of this volatility in 2018, our in-house managed accounts at TD Ameritrade invested in the Income, Conservative, Moderate, and even our Aggressive portfolios were UP for the year.  We did give back gains in December but were able to keep our head above water in these accounts because we moved a portion of the accounts to safety back in September before this market downturn started.

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November 2018 – Market Commentary

November 2018 – Market Commentary

Disclaimer:  These are the views of Summit Financial Consulting and should not be construed as investment advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. 

MARKET COMMENTARY
In the month of October, the Nasdaq lost 9.2%, the S&P 500 lost nearly 7%, the DOW lost 5%, the Russell 2000 small cap index lost almost 11%, and bonds on average had another rough month.  Source:  https://finance.yahoo.com/quote/%5EGSPC/history?p=%5EGSPC,
https://finance.yahoo.com/quote/%5EDJI/history?p=%5EDJI,
https://finance.yahoo.com/quote/%5EIXIC/history?p=%5EIXIC,
https://finance.yahoo.com/quote/%5ERUT/history?p=%5ERUT

Clients may have noticed several transactions last month. This can happen when volatility spikes. Within our in-house managed portfolios at TD Ameritrade, as we stated in our last market commentary 4 weeks ago, we sold large amounts of stock because our research said a rough patch was coming. The good news is we took this opportunity of increased volatility to replace almost all our mutual funds in our portfolios with TD Ameritrade’s new cost-free ETF’s (Exchange Traded Funds). ETF’s by design provide similar diversification to mutual funds, however, are up to 90% less expensive and trade by the second, unlike mutual funds that trade at the end of the day. This allows us to trade throughout the day and can potentially help us enter the market during rallies, and potentially minimize losses during selloffs. read more…

October 2018 – Market Commentary

October 2018 – Market Commentary

Disclaimer:  These are the views of Summit Financial Consulting and should not be construed as investment advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. 

Market Update
October has started off with a lot of volatility in both the stock and bond markets. As we’re posting this today (Oct. 11) the S&P 500 Index is already down over 5.5% for the month. Typically, when stocks are going up, bonds are going down, and vice-versa. However, that has not been the case as stocks and bonds have been losing to start the month. On a positive note, we decreased our exposure to small caps, growth, and technology September 21st of last month near all-time highs. We also added a utilities fund that has been making money during the current downswing. Yesterday we sold additional equity in hopes of protecting client accounts from further short-term losses in the market. Our treasury bond position varies from 20% to 10% across our portfolios and that could change if we feel interest rates will continue rising. Our short-term stock market indicator has turned red and we may be decreasing additional equity exposure if we feel it is prudent. Please remember we are watching the markets and going through more than 5 of our most trusted independent research companies daily to manage risk appropriately. We feel in today’s ultra-sensitive and fast paced stock and bond markets you need to be watching and evaluating daily. If you have a question about any of our recent research, trades, or anything in general, please give us a call.

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August 2018 – Market Commentary

August 2018 – Market Commentary

Disclaimer:  These are the views of Summit Financial Consulting and should not be construed as investment advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. 

Market Commentary

As of August 23rd, 2018, the DOW Jones Industrial average is up for the year 3.39% while our aggressive portfolio at TD Ameritrade is up 9.05%. This equates to a 5.66% outperformance for the year. The Barclay’s Aggregate Bond index is down -2.49%, while our most conservative portfolio, the income portfolio, is up 3.34% year-to-date. We’ve been able to navigate the bond market successfully this year by reducing interest rate sensitive holdings during the larger upswings in rates.  Our portfolios have reached all-time-highs several times this month and throughout the year as the stock market struggles to get back to where it was in January.

Overall the US economy is still doing well even with trade talks escalating and a total combined $100 billion of tariffs being imposed by the United States and China. With the Chinese economy slowing, authorities have actually instructed the Chinese media to scale back direct attacks on Trump and references to the trade war in connection with their economy. President Trump’s latest threat to impose an additional $200 billion in tariffs on Chinese goods could push up prices and cost U.S. consumers as much as $6 billion according to a new study released this week. This would be a potential short-term ramification of a long-term strategy by the POTUS to balance the global playing field (Source: http://thehill.com/policy/finance/403370-retailers-study-shows-more-trump-tariffs-could-cost-consumers-6-billion).

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