The Conservative portfolio fell 1.25% in October as both bonds and stocks were weak. The S&P500 dropped 1.67% while the Lehman Brothers Long Term Treasury Index fell 1.88%. Smaller-cap stocks fared worse, with the Russell 2000 index of smaller stocks down 3.1%.
American Century International Bond down 1.54% as the U.S. dollar rose and bonds in general slipped.
The Harbor bond fund fell just over 1% – a bit more than the aggregate bond index fell. As noted last month, Bill Gross is calling for a period of stagnant economic growth, which he thinks will (and usually does) lead to lower rates (good for bonds). He is likely increasing the duration of the portfolio as rates rise, which makes the fund a bit riskier.
Healthcare stocks were weaker than the market, with Health Care Select SPDR down about 3%. By far the weakest fund was our remaining 5% stake in American Century Utility Income (BULIX), down 6.38%. We are officially very negative in this area, but are waiting for a conservative place for the money. In general, utilities are perfect for a conservative portfolio that can handle some risk, because the yield offers more inflation protection than bonds over the long haul. 5% is the low end of what we would normally have here in the long run, but we may go down to 0%.
The Aggressive Growth portfolio fell 1.18% in October as both bonds and stocks were weak. The S&P500 dropped 1.67% while the Lehman Brothers Long Term Treasury Index fell 1.88%. Smaller cap stocks fared worse, with the Russell 2000 index of smaller stocks down 3.1%.
Healthcare stocks were weaker than the market, with Health Care Select SPDR down about 3%. Technology was about as weak as healthcare. Our Technology SPDR was down 2.1%.
Bridgeway Blue Chip 35 Index (BRLIX) beat most funds by simply being flat for the month (after months of lackluster returns compared to more exciting areas).
The weakest area last month was foreign markets (just not Japan). Smaller-cap and emerging markets stocks were the weakest of the lot. Artisan International Small Cap was down just under 5% in October, while SSgA Emerging Markets dipped 5.87%.
The only positive return was in T. Rowe Price Japan, up 0.89% in an otherwise bad month for stocks. Asian stocks were weak – the strength was really focused on Japan. There is spreading belief Japan has officially turned the corner on a decade and a half of troubling economic times. Some of this possibly stems from their auto industry dominating our collapsing industry. Toyota’s market cap is about double the combined market value of Ford, GM, and DaimlerChrysler combined, and that includes Mercedes, Saab, Jaguar, and other brands owned by the big (but fast becoming little) three.
The Harbor bond fund fell just over 1% – a bit more than the aggregate bond index fell. As noted last month, Bill Gross is calling for a period of stagnant economic growth, which he thinks will (and usually does) lead to lower rates (good for bonds). He likely is increasing the duration of the portfolio as rates rise – which makes the fund a bit more risky.
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The Conservative portfolio fell 1.25% in October as both bonds and stocks were weak. The S&P500 dropped 1.67% while the Lehman Brothers Long Term Treasury Index fell 1.88%. Smaller-cap stocks fared worse, with the Russell 2000 index of smaller stocks down 3.1%.
American Century International Bond down 1.54% as the U.S. dollar rose and bonds in general slipped.
The Harbor bond fund fell just over 1% – a bit more than the aggregate bond index fell. As noted last month, Bill Gross is calling for a period of stagnant economic growth, which he thinks will (and usually does) lead to lower rates (good for bonds). He is likely increasing the duration of the portfolio as rates rise, which makes the fund a bit riskier.
Healthcare stocks were weaker than the market, with Health Care Select SPDR down about 3%. By far the weakest fund was our remaining 5% stake in American Century Utility Income (BULIX), down 6.38%. We are officially very negative in this area, but are waiting for a conservative place for the money. In general, utilities are perfect for a conservative portfolio that can handle some risk, because the yield offers more inflation protection than bonds over the long haul. 5% is the low end of what we would normally have here in the long run, but we may go down to 0%.
The Aggressive Growth portfolio fell 1.18% in October as both bonds and stocks were weak. The S&P500 dropped 1.67% while the Lehman Brothers Long Term Treasury Index fell 1.88%. Smaller cap stocks fared worse, with the Russell 2000 index of smaller stocks down 3.1%.
Healthcare stocks were weaker than the market, with Health Care Select SPDR down about 3%. Technology was about as weak as healthcare. Our Technology SPDR was down 2.1%.
Bridgeway Blue Chip 35 Index (BRLIX) beat most funds by simply being flat for the month (after months of lackluster returns compared to more exciting areas).
The weakest area last month was foreign markets (just not Japan). Smaller-cap and emerging markets stocks were the weakest of the lot. Artisan International Small Cap was down just under 5% in October, while SSgA Emerging Markets dipped 5.87%.
The only positive return was in T. Rowe Price Japan, up 0.89% in an otherwise bad month for stocks. Asian stocks were weak – the strength was really focused on Japan. There is spreading belief Japan has officially turned the corner on a decade and a half of troubling economic times. Some of this possibly stems from their auto industry dominating our collapsing industry. Toyota’s market cap is about double the combined market value of Ford, GM, and DaimlerChrysler combined, and that includes Mercedes, Saab, Jaguar, and other brands owned by the big (but fast becoming little) three.
The Harbor bond fund fell just over 1% – a bit more than the aggregate bond index fell. As noted last month, Bill Gross is calling for a period of stagnant economic growth, which he thinks will (and usually does) lead to lower rates (good for bonds). He likely is increasing the duration of the portfolio as rates rise – which makes the fund a bit more risky.