Market Update Newsletter April 2014

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Wealth Management Newsletter

 

April 2014

 
 

Dear Richard,

Spring is here!  Yes, finally warmer weather and everything is starting to bloom, meaning change.  As you prepare for Spring Cleaning, not the house, but your Financial Plan, you should evaluate the perfromance of your plan. This years first quarter market performance is what to expect for the remainder of the year, a   yo - yo economy with the markets being very volatile. Every six months, you should review your portfolio, make any necessary changes to ensure your portfolio is working to your advantage, with positive results. Below is the performance of various diversified, strategic portfolios that I manage for my clients.  With this information below, compare your portfolio's returns to the benchmarks or the different portfolio risk type.  If your not satisfied with your results, maybe I can help or give you some advice.

 

Composite Performance

Qualified Portfolios

Portfolio

1   Year

3 Years

5 Years

Since Inception (11/2004)

100% Equities

25.95%

11.69%

15.50%

6.31%

Very Aggressive

22.37%

10.56%

14.35%

6.28%

Aggressive

20.04%

9.84%

13.65%

6.31%

Moderate

17.08%

8.98%

12.63%

5.96%

Conservative

12.77%

7.56%

11.40%

5.84%

Very Conservative

10.11%

6.81%

10.29%

5.36%

Ultra Conservative

5.18%

5.24%

NA*

5.97%^

100% Fixed Income

0.58%

3.48%

NA*

4.50%#

BENCHMARK

 

 

 

 

S&P 500

32.39%

16.18%

17.94%

7.34%

Russell 2000

38.82%

15.67%

20.08%

8.32%

MSCIEAFE (net)

22.78%

8.17%

12.44%

5.97%

BarCap Aggregate

-2.02%

3.26%

4.44%

4.63%

Source:  Bloomberg

Source:  ARIS Wealth Management

For the Period Ending December 31, 2013

Global Equity Performance a Mixed Bag          

Global equities put in a mixed performance last month, with previous market leaders succumbing to some profit taking while previous market laggards enjoyed a welcome bounce. For example, despite each falling more than two percent, both the NASDAQ Composite and Russell 2000 are relatively flat in 2014. On the flip side, emerging market stocks' 4.5 percent gain this past week still leaves them down almost 2.5 percent year-to-date.

Index Returns (%) 

Source:  Bloomberg

Index

 1 Week

YTD

1 Year

Dow Jones 30

0.12

-1.53

12.01

S&P 500

-0.48

0.50

18.91

Russell 2000

-3.61

-1.12

22.56

MSCI EAFE

1.92

-0.59

14.24

S&P GS Commodities

1.32

3.05

1.54

U.S. Trade-Weighted $

0.08

0.17

-3.09

Index Levels

Source:  Bloomberg

Index

 Current Week (03/28/14)

Prior Week (3/21/14)

Year End (12/31/12)

Year Ago

(03/28/13)

Dow Jones 30

16,323

16,303

16,577

14,579

S&P 500

1,858

1,866

1,848

1,569

Russell 2000

1,151

1,194

1,164

952

MSCI EAFE

1,904

1,869

1,916

1,675

S&P GS Commodities

4,977

4,914

4,830

4,927

U.S. Trade-Weighted $

80.17

80.11

80.04

82.95

U.S. 10Yr Treasury Yield(%)

2.72

2.74

3.03 

1.85

Japan Under the Microscope       

Similar to emerging markets, even after this week's near four percent rise, the Japanese Nikkei is still down more than nine percent in 2014. As part of "Abenomics," next week Prime Minister Shinzo Abe is set to raise the national consumption tax in Japan to eight percent (from its current five percent), with another hike to 10 percent planned in October 2015. Markets have been nervous about these tax increases and their possible dampening effect on the Japanese economy. The last time the consumption tax was increased (April 1997) the economy lurched into recession shortly thereafter. Now, like then, consumers had front-loaded motor vehicle purchases.

Word from the ECB Coming Next Week        

The European Central Bank (ECB) meets next week on April 3. Inflation in the Euro-zone has persisted below one percent for some time now, precariously close to outright deflation. However, ECB President Mario Draghi stated at last month's policy meeting that the Euro-zone economy was improving in line with the ECB's expectations. Data on unemployment in the Euro-zone is set to be released on Tuesday.

Markets Awaiting a Catalyst?       

At the end of 2013, financial markets had reached an interesting juncture, with short-term stock market optimism at quite lofty levels and bond market sentiment at very pessimistic levels. Given these two extremes, and the fact that unseasonably poor weather clouded the economic picture for much of the first quarter, it is understandable that stocks have made little headway so far in 2014. Indeed, since the middle of February the S&P 500 has oscillated in a range between 1,840 and 1,880, perhaps awaiting a catalyst to shake it out of its recent consolidation.

Could Encouraging Economic Data be that Catalyst?       

What could such a catalyst be? Next week investors will certainly also be focused on the Institute of Supply Management (ISM) Manufacturing and Non-Farm Payrolls reports for March. Preliminary glimpses into March data from the Philadelphia Fed General Business Activity Index and continuing downward trend in weekly unemployment claims are hopeful signs that the economy is emerging from its weather-induced soft patch. The following week, earnings season is due to kick off with Alcoa on April 8.

Fees/Cost/Commission

I have been asked how much do I charge or the cost for my services.  No one should pay a fee to consult with an advisor or to ask for advice.  Also, you should not pay a fee for your annual review. The only fees I can control, are for Managed Accounts. I usually charge 1% to the client of the total assets under management. All other insurance products or investments are set by the individual institutions.  For all my clients, I do disclose all my fees and you should ask your advisor what you are paying for and the fees associated to your portfolio. 



Sumner Wealth Management, Inc.

Mark Sumner

Financial Advisor

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Services Offered:

  • Business & Personal Financial Planning
  • Business Continuation Strategies
  • Retirement Plan Consulting & Design (401k)
  • Investment Programs
  • Tax & Estate Planning Strategies
  • Life, Health, Disability, and Long-Term Care Insurance
  • Medicare Supplement Plans

 

Contact Information

(704) 660.5510 x401

msumner@ssnrep.com

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Securities offered through Securities Service Network, Inc. Member:  FINRA/SPIC

If a recommendation is included in th above email, please contact me for additional investment information supporting the recommendation.

Fee based advisory services offered through SSN Advisory, Inc. a registered investment advisor  


Sumner Wealth Management,Inc. | 517 Alcove Road | Suite 202 | Mooresville | NC | 28117

(704) 660.5510 x401 | www.sumnerwealthmanagement.com | msumner@ssnrep.com

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