The Conservative Portfolio dropped -2.22% in June.
The strength we saw in most stock indexes in May turned to weakness in June. Before all was said and done the Dow was down around 10% for the month, with other broad indexes following suit. The Nasdaq dropped 9.11% in June, the Russell 2000 small cap index 7.7%, and the S&P 500 8.43%. With July’s continued carnage we’re now in bear market territory – a 20% drop from a market peak – in all of the big indexes. None of our model portfolios was down more than 5% in June.
Foreign stocks have offered no salvation; in fact some European stock indexes are now at three year lows. Fortunately we’ve been pretty light on foreign stocks – and stocks in general – in the Powerfund Portfolios for much of the last two years. Bonds were flat for the month but longer term U.S. government bonds offered some protection with a 1.55% return as recently rising interest rates turned back down on general fears of a long economic slowdown trumped inflation fears.
At the top of the list of problems are continued troubles in the housing market. REITs – or real estate investment trusts – plunged anew, wiping out what little gains they made earlier this year after last year’s drop. Investors are starting to realize that commercial real estate is not immune from the real estate bubble troubles – why anybody thought this trouble was confined to the residential real estate is a mystery. Today many bank stocks are down 80% or more from their highs. Fannie and Freddie – the two giant government sponsored enterprises at the center of the real estate bubble – are now holding on by a thread, or so stockholders seem to think. Sooner or later we’ll see how much of a sponsor the U.S. government really is.
We’re using this latest drop as a buying opportunity and increased our stock fund allocations across all portfolios at the end of June.
Harbor Bond (HABDX) fell 0.91% in June, which shows that Bill Gross has moved into riskier debt this year as June was a month mostly very safe government bonds performed well. We’re now moving back into Junk bonds and expect higher risk debt to beat safe government debt over the next few years.
Nakoma Absolute Return (NARFX) had a solid June with a 2.27% gain. We mildly concerned that oil stocks were going to continue to rise, hurting this funds shorts and adding more risk that we wanted from this portfolio. However with the market tanking and more trouble in financials this fund’s shorts have so far worked out well. Three is nothing like making a nice positive return in a dark month for stocks. Keep in mind this is not some 100% short / inverse fund it can make money in up markets as well.
Bridgeway Balanced (BRBPX) had another good month with a mere 2.86% fall. Given the upside Bridgeway Balanced has shown in positive months for stocks, this fund has been adding value even though it is down 1.58% over the last 12 months (the S&P 500 is down over 13% over the same period).
Healthcare stocks continued to offer some relative performance benefits compared to the market as investors apparently are now a little less worried about healthcare profits going forward Healthcare Select SPDR (XLV) was down 5.11% for the month.
Growth stocks continued to lead the market with ‘just’ a 6.73% drop in June in Vanguard Growth ETF (VUG). That’s not a good return in absolute terms, but relative to value stocks and the market in general it’s acceptable and drives home the point that growth stocks have been and still are leading the market.
The Aggressive Portfolio fell -4.69% in June.
The strength we saw in most stock indexes in May turned to weakness in June. Before all was said and done the Dow was down around 10% for the month, with other broad indexes following suit. The Nasdaq dropped 9.11% in June, the Russell 2000 small cap index 7.7%, and the S&P 500 8.43%. With July’s continued carnage we’re now in bear market territory – a 20% drop from a market peak – in all of the big indexes. None of our model portfolios was down more than 5% in June.
Foreign stocks have offered no salvation; in fact some European stock indexes are now at three year lows. Fortunately we’ve been pretty light on foreign stocks – and stocks in general – in the Powerfund Portfolios for much of the last two years. Bonds were flat for the month but longer term U.S. government bonds offered some protection with a 1.55% return as recently rising interest rates turned back down on general fears of a long economic slowdown trumped inflation fears.
At the top of the list of problems are continued troubles in the housing market. REITs – or real estate investment trusts – plunged anew, wiping out what little gains they made earlier this year after last year’s drop. Investors are starting to realize that commercial real estate is not immune from the real estate bubble troubles – why anybody thought this trouble was confined to the residential real estate is a mystery. Today many bank stocks are down 80% or more from their highs. Fannie and Freddie – the two giant government sponsored enterprises at the center of the real estate bubble – are now holding on by a thread, or so stockholders seem to think. Sooner or later we’ll see how much of a sponsor the U.S. government really is.
We’re using this latest drop as a buying opportunity and increased our stock fund allocations across all portfolios at the end of June.
Nakoma Absolute Return (NARFX) had a solid June with a 2.27% gain. We mildly concerned that oil stocks were going to continue to rise, hurting this funds shorts and adding more risk that we wanted from this portfolio. However with the market tanking and more trouble in financials this fund’s shorts have so far worked out well. Three is nothing like making a nice positive return in a dark month for stocks. Keep in mind this is not some 100% short / inverse fund it can make money in up markets as well.
Healthcare stocks continued to offer some relative performance benefits compared to the market as investors apparently are now a little less worried about healthcare profits going forward Healthcare Select SPDR (XLV) was down 5.11% for the month.
Tech stocks fell with the market but considering they tend to fall harder than the market we can’t complain with a 9.93% drop in our Technology SPDR (XLK).
Harbor Bond (HABDX) fell 0.91% in June, which shows that Bill Gross has moved into riskier debt this year as June was a month mostly very safe government bonds performed well. We’re now moving back into Junk bonds and expect higher risk debt to beat safe government debt over the next few years.
Biotech stocks fell about half as much as the market in June, which is amazing considering that investors tend to run from higher risk stocks in sharply down markets. Biotech stocks are about as far as you can get from consumer spending in the market, partially explaining the relatively good returns. SPDR Biotech (XBI) fell 4.22% in June but is still up 12.87% over the last 12 months – compare to the S&P 500’s over 13% drop over the same time period.
Growth stocks continued to lead the market with ‘just’ a 6.73% drop in June in Vanguard Growth ETF (VUG). That’s not a good return in absolute terms, but relative to value stocks and the market in general it’s acceptable and drives home the point that growth stocks have been and still are leading the market.
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The Conservative Portfolio dropped -2.22% in June.
The strength we saw in most stock indexes in May turned to weakness in June. Before all was said and done the Dow was down around 10% for the month, with other broad indexes following suit. The Nasdaq dropped 9.11% in June, the Russell 2000 small cap index 7.7%, and the S&P 500 8.43%. With July’s continued carnage we’re now in bear market territory – a 20% drop from a market peak – in all of the big indexes. None of our model portfolios was down more than 5% in June.
Foreign stocks have offered no salvation; in fact some European stock indexes are now at three year lows. Fortunately we’ve been pretty light on foreign stocks – and stocks in general – in the Powerfund Portfolios for much of the last two years. Bonds were flat for the month but longer term U.S. government bonds offered some protection with a 1.55% return as recently rising interest rates turned back down on general fears of a long economic slowdown trumped inflation fears.
At the top of the list of problems are continued troubles in the housing market. REITs – or real estate investment trusts – plunged anew, wiping out what little gains they made earlier this year after last year’s drop. Investors are starting to realize that commercial real estate is not immune from the real estate bubble troubles – why anybody thought this trouble was confined to the residential real estate is a mystery. Today many bank stocks are down 80% or more from their highs. Fannie and Freddie – the two giant government sponsored enterprises at the center of the real estate bubble – are now holding on by a thread, or so stockholders seem to think. Sooner or later we’ll see how much of a sponsor the U.S. government really is.
We’re using this latest drop as a buying opportunity and increased our stock fund allocations across all portfolios at the end of June.
Harbor Bond (HABDX) fell 0.91% in June, which shows that Bill Gross has moved into riskier debt this year as June was a month mostly very safe government bonds performed well. We’re now moving back into Junk bonds and expect higher risk debt to beat safe government debt over the next few years.
Nakoma Absolute Return (NARFX) had a solid June with a 2.27% gain. We mildly concerned that oil stocks were going to continue to rise, hurting this funds shorts and adding more risk that we wanted from this portfolio. However with the market tanking and more trouble in financials this fund’s shorts have so far worked out well. Three is nothing like making a nice positive return in a dark month for stocks. Keep in mind this is not some 100% short / inverse fund it can make money in up markets as well.
Bridgeway Balanced (BRBPX) had another good month with a mere 2.86% fall. Given the upside Bridgeway Balanced has shown in positive months for stocks, this fund has been adding value even though it is down 1.58% over the last 12 months (the S&P 500 is down over 13% over the same period).
Healthcare stocks continued to offer some relative performance benefits compared to the market as investors apparently are now a little less worried about healthcare profits going forward Healthcare Select SPDR (XLV) was down 5.11% for the month.
Growth stocks continued to lead the market with ‘just’ a 6.73% drop in June in Vanguard Growth ETF (VUG). That’s not a good return in absolute terms, but relative to value stocks and the market in general it’s acceptable and drives home the point that growth stocks have been and still are leading the market.
The Aggressive Portfolio fell -4.69% in June.
The strength we saw in most stock indexes in May turned to weakness in June. Before all was said and done the Dow was down around 10% for the month, with other broad indexes following suit. The Nasdaq dropped 9.11% in June, the Russell 2000 small cap index 7.7%, and the S&P 500 8.43%. With July’s continued carnage we’re now in bear market territory – a 20% drop from a market peak – in all of the big indexes. None of our model portfolios was down more than 5% in June.
Foreign stocks have offered no salvation; in fact some European stock indexes are now at three year lows. Fortunately we’ve been pretty light on foreign stocks – and stocks in general – in the Powerfund Portfolios for much of the last two years. Bonds were flat for the month but longer term U.S. government bonds offered some protection with a 1.55% return as recently rising interest rates turned back down on general fears of a long economic slowdown trumped inflation fears.
At the top of the list of problems are continued troubles in the housing market. REITs – or real estate investment trusts – plunged anew, wiping out what little gains they made earlier this year after last year’s drop. Investors are starting to realize that commercial real estate is not immune from the real estate bubble troubles – why anybody thought this trouble was confined to the residential real estate is a mystery. Today many bank stocks are down 80% or more from their highs. Fannie and Freddie – the two giant government sponsored enterprises at the center of the real estate bubble – are now holding on by a thread, or so stockholders seem to think. Sooner or later we’ll see how much of a sponsor the U.S. government really is.
We’re using this latest drop as a buying opportunity and increased our stock fund allocations across all portfolios at the end of June.
Nakoma Absolute Return (NARFX) had a solid June with a 2.27% gain. We mildly concerned that oil stocks were going to continue to rise, hurting this funds shorts and adding more risk that we wanted from this portfolio. However with the market tanking and more trouble in financials this fund’s shorts have so far worked out well. Three is nothing like making a nice positive return in a dark month for stocks. Keep in mind this is not some 100% short / inverse fund it can make money in up markets as well.
Healthcare stocks continued to offer some relative performance benefits compared to the market as investors apparently are now a little less worried about healthcare profits going forward Healthcare Select SPDR (XLV) was down 5.11% for the month.
Tech stocks fell with the market but considering they tend to fall harder than the market we can’t complain with a 9.93% drop in our Technology SPDR (XLK).
Harbor Bond (HABDX) fell 0.91% in June, which shows that Bill Gross has moved into riskier debt this year as June was a month mostly very safe government bonds performed well. We’re now moving back into Junk bonds and expect higher risk debt to beat safe government debt over the next few years.
Biotech stocks fell about half as much as the market in June, which is amazing considering that investors tend to run from higher risk stocks in sharply down markets. Biotech stocks are about as far as you can get from consumer spending in the market, partially explaining the relatively good returns. SPDR Biotech (XBI) fell 4.22% in June but is still up 12.87% over the last 12 months – compare to the S&P 500’s over 13% drop over the same time period.
Growth stocks continued to lead the market with ‘just’ a 6.73% drop in June in Vanguard Growth ETF (VUG). That’s not a good return in absolute terms, but relative to value stocks and the market in general it’s acceptable and drives home the point that growth stocks have been and still are leading the market.