Q4 and 2017 market Review

2017 was a momentous year for investors! Not only were returns positive across almost all asset classes, there was very little volatility as well. All investors love great returns with little risk (volatility), but usually you can’t have one without the other. However, 2017 presented this opportunity, but remember it was uncharacteristic. Here are some 2017 statistics: 

 

The S&P 500 index was up every month, the last time that happened was 1959.

Volatility of the S&P 500 was the lowest it has been since 1964 as measured by average daily price change.

The DOW hit market highs 70 times.

The S&P 500 gained 21.83% and the largest drawdown (peak to trough decline) was

-2.6%, which is very low. Here are some additional years for comparison:

Year                 Return             Maximum Drawdown

2017                21.83%                        -2.6%

2016                11.96%                        -10.3%

2015                1.38%                          -12%

2014                13.69%                        -7.3%

2008                -37%                            -47.7%

 

In Q4 2017 stocks in the US, international markets, emerging markets and real estate were all up. US and global bonds were also positive. The same is true for the entire year of 2017. It is worth noting that international and emerging stock markets both outperformed the US in 2017 for the first time in years.

 

For a detailed market overview covering Q4 and all of 2017, click here.

 

Planning note: You and I have no control of market returns, however, we do have control of how we choose to invest. First and foremost, assign a purpose to your assets. This will allow you to determine an appropriate investment strategy for your specific objectives. 

 

Here are my principles for investing success: 

Maintain broad diversification

Align your investments with your objectives

Don't let fear or greed drive your decisions

Be disciplined and consistent

Consider taxes and fees

 

 

 

Advisory services offered through Arbor Point Advisors. Securities offered through Securities America Inc., Member FINRA/SIPC. Arbor Point and Securities America are separate companies. CA Insurance #0E88557

Rancho Bernardo Financial Planner