Below is a snapshot of last week’s market performance and what to watch in the week ahead from Chadd Mason, Cabana CEO and co-founder.
U.S and international equity markets continue to take a drubbing. Since October 1, 2018 the S&P 500 is down almost 13%, the Nasdaq is down 16% and the ACWI world equity index is down 12.3%. All major equity indexes worldwide are under water for the year. As of this writing, the S&P 500 breached the February low, recovering at the Dec. 17 close to end right at that support level. Many market technicians have expected a retest of these levels and believe that the market’s ability to hold and recover will decide once and for all whether the nine-year-old bull market is over and a bear market for stocks has begun. I happen to be in this same camp. While earnings and unemployment numbers remain positive, it rarely pays to argue with price. Right now, price is flashing a huge red warning sign. While we wait for clarity, I did some research on just how difficult 2018 has been for all types of investors. I commented on this in a blog last week, pointing out that this has been the worst year since Nixon was in office when considering performance across all asset classes.
The following is the year-to-date returns for major asset classes:
- Energy: -17%
- Gold: -5.8%
- Commodities: -8.5%
- Long Treasury Bonds: -5.8%
- Corporate Grade Bonds: -7.1%
- Real Estate: -5.2%
- Small Cap U.S. Equities: -11%
- Emerging Market Equities: -17.8%
- Developed Market Equities: -9.8%
- U.S. Total Market Equities: -5.8%
That, my friends, is a tough year for investors of all types.
Download a PDF of this week’s market commentary at the following link: Weekly Market Commentary December 17 2018
Disclaimers:
This material is prepared by Cabana, LLC, dba Cabana Asset Management and/or its affiliates (together “Cabana”) for informational purposes only and is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. The opinions expressed reflect the judgement of the author, are as of the date of its publication and may change as subsequent conditions vary. The information and opinions contained in this material are derived from proprietary and nonproprietary sources deemed by Cabana to be reliable, are not necessarily all-inclusive and are not guaranteed as to accuracy. As such, no warranty of accuracy or reliability is given and no responsibility arising in any other way for errors and omissions (including responsibility to any person by reason of negligence) is accepted by Cabana, its officers, employees or agents.
This material may contain ’forward looking’ information that is not purely historical in nature. Such information may include, among other things, projections and forecasts. There is no guarantee that any forecasts made will come to pass. Reliance upon information in this material is at the sole discretion of the reader. Past performance is not a reliable indicator of current or future results and should not be the sole factor of consideration when selecting a product or strategy. All investment strategies have the potential for profit or loss. All strategies have different degrees of risk. There is no guarantee that any specific investment or strategy will be suitable or profitable for a particular client. The information provided here is neither tax nor legal advice. Investors should speak to their tax professional for specific information regarding their tax situation. Investment involves risk including possible loss of principal.
Cabana LLC, dba Cabana Asset Management (“Cabana”), is an SEC registered investment adviser with offices in Fayetteville, AR and Plano, TX The firm only transacts business in states where it is properly registered or is exempted from registration requirements. Registration as an investment adviser is not an endorsement of the firm by securities regulators and does not mean the adviser has achieved a specific level of skill or ability. Additional information regarding Cabana, including its fees, can be found in Cabana’s Form ADV, Part 2. A copy of which is available upon request or online at https://www.adviserinfo.sec.gov/.
Cabana did not pay a fee to participate in the ranking and survey and is not affiliated with Financial Advisor Magazine. RIAs were ranked based on percentage growth in year-end 2017 AUM over year-end 2016 AUM with a minimum AUM of $250 million, assets per client, and growth in percentage assets per client. Visit www.fa-mag.com information regarding the ranking.
