Market Commentary: Second Quarter

Market Commentary Q2 2019

If you are a die- hard women’s soccer fan or if you like following and supporting national sports, you might have tuned into the Women’s World Cup Soccer tournament. The U.S. women had the difficult task of defending their title as the World Cup champions. At the beginning of the tournament, many people had predicted the top teams based on their ranking and historical performance. The end results however do not always match the rankings, possibly because of injuries sustained during the tournament, missed officiating calls, or missed opportunities. Although a team might be expected to win, a win is certainly not guaranteed because of multiple factors involved.  Also, there is no correlation between the winning soccer team and their respective stock market performance.

Investment allocations can be similar. When we construct a portfolio, we analyze the data of the available asset classes and design an investment mix that we expect to perform well.  From week to week, or year to year, some investments perform better than others (we cannot predict which ones), and we rebalance the portfolio to take advantage of the gains they provide.

So far in 2019, global stocks continue to rally. The S&P 500 Index was up 4.3% for the quarter and 18.54% year to date. U.S. small cap stocks represented by the Russell 2000 Index were up 2.10% for the quarter and 16.98% year to date. The iShares MSCI EAFE Index representing international stocks were up 3.68% for the quarter and 14.03% year to date. With the Federal Reserve talking about reducing rates, bonds represented by the Barclays US gov/credit 1-5 Year Index were up 1.92% for the quarter, and 3.56% year to date.

The U.S. women prevailed this year over strong competition. We design your investments to prevail as well. Thank you for entrusting us to help you achieve your financial goals.