The problem with the person who thinks he’s a long-term investor and impervious to short-term gyrations is that the emotion of fear and pain will eventually make him sell badly. Robert Wibbelsman
Where are we, YTD and at the end of April?
Between January 26 and February 8 of this year, the stock market dropped around 10 to 11% percent, depending on which index. That’s a 2 week period. Ever since then, the markets have moved generally sideways – demand stepping in when prices got low and selling coming in when prices rose. I’ve stated in previous newsletters that on average there is one drop of at least 10% every calendar year – and we didn’t have one in 2017. Whether you are tracking the weather or freeway traffic or basketball free throws, statistical deviations average out.
EVENTUALLY prices will break out of the 10 percent range. A further decline could happen but as yet, we aren’t seeing the patterns that historically lead to a bear market, which is the only event that is worth trying to defend against.
How Did the Markets and our Funds Do YTD and in April?
All index and fund returns are courtesy Morningstar.com.
YTD the markets were somewhat mixed, the Dow, S&P, NYSE Composite and US Aggregate Bonds being down; the Nasdaq (technology), foreign markets and small cap being up. Everything was close to breakeven. Our accounts (managed all year by KII) were virtually all marginally up (maybe 99% of them). Interestingly, our Fidelity mutual funds have been mostly home runs YTD. The bad return YTD of bonds in general was not a problem for us, due to our heavy reliance on floating rate funds and peer to peer income.
The month of April was marginally up for all the markets and our accounts were very close to breakeven for the month, as well.
Here are the index returns and our fund returns for the month of April and for the year to date through 4/30.:
| APR | YTD | |||
| S&P 500 | 0.22% | -0.38% | ||
| Nasdaq (technology) | 0.03% | 2.36% | ||
| Dow | 0.25% | -1.63% | ||
| NYSE Composite | 0.51% | -2.29% | ||
| Morningstar Div Emerging Mkts | -1.91% | 0.12% | ||
| Russell 2000 (small co) | 0.81% | 0.78% | ||
| US Aggregate Bond Index | -0.63% | -2.19% | ||
| IEMG | -2.65% | iShares Emerging Markets | Fidelity commission free ETF | -0.09% |
| FQAL | -0.41% | Fidelity Quality Factor | Fidelity commission free ETF | -0.88% |
| ONEQ | 0.29% | Fidelity Nasdaq | Fidelity commission free ETF | 2.57% |
| FTEC | 0.02% | Fidelity Info Tech | Fidelity commission free ETF | 4.05% |
| FHLC | 0.88% | Fidelity MSCI Healthcare | Fidelity commission free ETF | 0.77% |
| IEV | 2.08% | iShares Europe | Fidelity commission free ETF | 0.72% |
| FBIOX | -2.04% | Fidelity Biotech | stock mutual fund | 0.97% |
| FSMEX | 3.60% | Fidelity Medical Equipment | stock mutual fund | 9.22% |
| FCNTX | 1.20% | Fidelity Contra Fund | stock mutual fund | 4.29% |
| FBGRX | 1.47% | Fidelity Blue Chip Growth | stock mutual fund | 4.54% |
| CFRAX | 0.12% | Catalyst floating rate | bond mutual fund | 2.11% |
| FFRAX | 0.41% | Fidelity floating rate | bond mutual fund | 1.53% |
| EIFAX | 0.48% | Eaton Vance floating rate | bond mutual fund | 2.20% |
| RNDLX | -0.17% | RiverNorth Strategic | bond mutual fund | -0.46% |
| FNMIX | -1.73% | Fidelity New Market | bond mutual fund | -2.89% |
| FAGIX | 0.20% | Fidelity Capital & Income | bond mutual fund | -0.54% |
| LENDX | 0.49% | Stone Ridge Alternative | peer to peer fixed return m.f. | 1.92% |
| Prime Meridian Small Bus LP | 0.59% | 1 month lag | private peer to peer fixed | 2.23% |
| Prime Meridian Real Estate LP | 0.62% | 1 month lag | private peer to peer fixed | 2.50% |
| KIP, Kay Income Partners LP | 0.56% | private mortgage fund | 2.24% |
Your investment return(s) for the month of April and YTD through 4/30 was/were as follows:
Your quarterly advisory fees, paid in arrears, were as follows:
We should talk if you would like to review exactly where you stand or if we should consider a change. I am available at your convenience. I have Skype video in case you would like to do a video conference.
Best,