POCKETBOOK Week Ending Feb.1, 2019

• Golden appeal

Turns out, central banks bought more gold in 2018 than any years since 1967, according to the World Gold Council. That’s good news for anyone loving this precious metal—just not always profitable news.

Surprisingly, that increase in what gold was being used for wasn’t in jewelry. Nope, counties such as China, Poland, Russia, Turkey and Kazakhstan have been adding it to their reserves. Jewelry demand, on the other hand, was pretty much unchanged.

We’ve been told that gold is generally thought of as a good bet during times of political or economic unrest and turbulence. And, it’s always been thought of as a kind of balancer, or hedge, to one’s existing equity portfolios during volatile markets even though making money from it hasn’t been a slam dunk.

That said, if you’ve an interest in the glittery stuff, here’s a brief look at how its per ounce price has performed over the years according to data from KITCO.com;

-10 year high 1900.30; low 868.70

-5 year high 1382.; low 1050.6

-1 year high 1353.30; low 1173,70

-Today, Monday, Feb.4, 2019 at 2:52 pm—1313.70

“Economic uncertainty, slowdown, (and the) U.S.-China trade conflict supported investment flows,” said the World Gold Council’s head of market intelligence, Alistair Hewitt who added. “This dynamic is likely to run through 2019.”

 

• Market Quick Glance

Nice jump ups last week on the year-to-date returns for the three indices followed here. But can that trend, if it is a trend, continue? Time will tell.

Below are the weekly and 1-year index performance results for the three major indices—DJIA, S&P 500 and NASDAQ — including the dates each reached new highs. Data is according to CNBC.com and based on prices at the close of business on Friday, Feb.1, 2019.

–DJIA 7.44% YTD up from the previous week’s 6.04%.

• 1 yr. Rtn -4.29% improved from the previous week -6.2%

Most recent DJIA a new ALL-TIME CLOSING HIGH was reached on Oct.3, 2018 of 26,951.81. The previous high was reached on Sept. 21, 2018 of 26,796.16.

 

-S&P 500   7.97 % YTD down from last week’s 6.30%

• 1 yr. Rtn -4.09% improved from last week’s -6.15%

The S&P 500 reached a BRAND NEW CLOSING ALL-TIME HIGH on Sept. 21, 2018 of 2,940.91. The previous closing high was reached on August 29, 2018 of 2,916.50.

 

-NASDAQ 9.47% YTD up from last week’s 7.98%

• 1yr Rtn -1.65% improved from last week’s -3.32%

NASDAQ reached a BRAND NEW 52-week CLOSING HIGH on August 30, 2018 of 8,1333.30. The previous high was reached on August 24, 2018 of 7,949.71.

 

-Mutual funds

Repeat from early January:

Looking up.

At the close of business on Thursday, Jan. 10, 2019, the total return for the average stock fund under the broad U.S. Diversified Equity Fund heading was 4.70%, according to Lipper.

Looking at the fund types with the highest year-to-date gains under the various headings shows the following:

-U.S. Diversified Equity Funds average, 4.70%; highest Equity Leveraged Funds, 11.08%; lowest, Dedicated Short Bias Funds, -8.88%

-Sector Equity Funds average 4.88%; highest Energy MLP Funds, 11.74%; lowest Alternative Managed Funds, -2.20%

-World Equity Funds average 4.07%; highest Latin American Funds, 9.01%; lowest India Region Funds, -1.23%.

Visit www.allaboutfunds.com for more information about how various equity and fixed-income funds have rewarded investors over the short-and long-term, based upon Lipper data. Short-term meaning weekly and monthly performance returns; longer-term includes quarterly, year-to-date, 1-yr, 2-yr, 3-yr and 5-yr returns.

 

• Christian Investing

I remember learning that it was easier for a camel to get through the eye of a needle than it was for a rich man to get into heaven. I’m going to guess that the folks who run the various portfolios of the Timothy Plan might see that differently.

The Timothy Plan group of funds was created 25 years ago to meet the needs of Christian investors who didn’t want their money invested in companies that support things such as pornography, abortion, wars, any anti-family causes or simply companies whose products run contrary to the teachings of Scripture.

To date that’s paid off for them as the family now has over $1 billion under management.

From their recent press release: “The impact of our investments affects more than the return column on our account statements, it enables companies of high moral character to establish a greater presence in our community at large—Kingdom Impact Investing.”

Believers in that style of investing can learn more about their funds, fund performances, etc.  at TimothyPlan.com.

-30-

 

 

Advertisement

POCKETBOOK: Week ending April 14, 2018

• Golden

Good news this week for gold investors. On Wednesday, gold futures traded at an intraday high of $1,369.30 an ounce, according to Gary Wagner’s Kitco Commentary on Friday, April 13, 2018.

The June Comex contract wasn’t quite that high at the close of business on Friday ($1,348.60), but even so, for the week gold had enjoyed an $11 an ounce  gain.

That’s a big deal because this precious metal has had a hard time making any kind of sustainable gains over the past few years. And, in a jumpy market like we’ve all been a part of, one might consider that a bit of an oddity.

That said, the big takeaway here is that you’ve got to go back to August 2016 to find gold trading at that high a level. “More importantly,” writes Wagner, “ the highs achieved during that rally were the first occurrence of a higher high since the multiyear correction (that) began in the middle of 2011.”

Perhaps it’s time to reconsider the value of this precious metal for ones investment portfolio other than see its worth only in golden bangles, earrings or as a cap to top off one of your back molars.

 

• Market Quick Glance

A better performance week for stock index results than the week before with the downs not as down and the ups more up.

Look at the 1-year returns and one might even begin to wonder what all the bears on Wall Street are concerned about. Then again, the only time that 1-year returns that seem to matter to the average investor is when the end of the year 52-week results are in.

Below are the weekly and 1-year index performance results for four major indices— including the dates each reached new highs—according to CNBC.com based on prices at the close of business on Friday, April 13, 2018.

 

–DJIA -1.45% YTD down but less than the previous week’s -3.18%

• 1 yr Rtn 19.10% up from the previous week’s 15.82%

Most recent DJIA all-time high was reached on January 26, 2018 of 26,616.71. The previous high was reached January 18, 2018 was 26,153.42.

 

-S&P 500 -0.65% YTD down much less than last week’s -2.59%

• 1 yr Rtn 14.06% up from last week’s 10.48%

The S&P 500 reached its most recent all-time high on January 26, 2018 of 2,872.87. The previous high was reached on January 19, 2018 of 2810.33.

 

-NASDAQ 2.94% YTD way up from last week’s 0.17%

• 1yr Rtn 22.42% way up from last week’s 17.62%

Nasdaq reached a brand new all-time high on March 13, 2018 of 7,637.27. The previous high was reached on March 9, 2018 of 7,560.81.

 

-Russell 2000 0.91% YTD up from than last week’s -1.45%

• 1yr Rtn 15.18% way up from last week’s 10.91%

The Russell 2000 reached an all-time high on January 24, of 1,615.52. The previous high was reached on January 16, 2018 of 1,604.02.

 

-Mutual funds

Lipper’s weekly mutual fund performance figures not available yet. Will post them when received.

Till then, here’s a repeat look at last week’s report: At the close of business on Thursday, April 4, 2018 the average fund that falls under the broad U.S. Diversified Equity Funds heading had a year-to-date return of +0.32%. That’s up—yes up—from the previous week’s average of -0.37%.

Large-Cap and Small-Cap Growth funds were up on average well over 3% last week. Science & Technology Funds and Global Science & Technology Funds both up at 4.92 and 5.08% respectively.

Latin American Funds, too, were up–averaging almost 6% y-t-d.

The biggest loser fund type of all were Energy MLP, down on average -10.02%.

Visit www.allaboutfunds.com for more information about how various equity and fixed-income funds have rewarded investors over the short-and long-term, based upon Lipper data. Short-term meaning weekly and monthly performance returns; longer-term includes quarterly, year-to-date, 1-yr, 2-yr, 3-yr and 5-yr returns.

 

•   Credit Risks

The ability to raise, borrow and repay money is great deal. And one individuals as well as businesses count on. But like everything else within the world of money, risks exist and timing is everything.

Last week, Jack Ablin,CFA and Chief Financial Officer at Cresset Wealth Advisors published a piece titled “Credit Conditions and Risk Taking”.

From the piece: “The easiest way to gauge real time credit conditions is by observing the yield differential between 10-year, BBB bonds and 10-year Treasury notes. Since the bond market is roughly seven times the size of the stock market, the yield premium lenders require to extend credit to lower-quality borrowers is a useful barometer.”

While currently credit conditions are “favorable”, Ablin thinks that rising credit spreads can be an early warning sign of troubles ahead.

The chart below  provides additional insight on the subject.

 

-30-