Tag Archives: Rule of 72

POCKETBOOK: Week ending May 28, 2016

  • american-flag-cupcakes Memorial Day

Since our country first began, more than 1.1 MILLION Americans have perished in wars and conflicts fighting for and upholding the freedoms we all are fortunate enough to enjoy in this gorgeous, diversified, ever-changing and enduring country that we call home.

Do pause, honor and celebrate them.

  • Market Quick Glance


Here are the year-to-date performance figures for the major indices through May 27, 2016, according to Bloomberg. To provide a longer performance perspective, 1-year returns have been added.

All four of the indices below showed significant performance improvements from the previous week’s returns. Clearly that is something to cheer about. But the big question remains: Is this a positive performance trend that will continue or merely a short-term spike? As always, time will tell.

-Dow Jones +3.85% YTD  (almost double from last week)

1yr Rtn +1.85 % (up from -1.44%)

-S&P 500 +3.66%YTD (more than doubled from previous week of 1.32% YTD)

1yr Rtn +1.80% (up almost 50 basis points)

NASDAQ -0.85% YTD (a significant improvement from last weeks -4.18%)

1yr Rtn -1.37% (also a big move upward from last week’s -5.03%)

Russell 2000 +1.88 YTD (a delightful upside move from last week’s -1.53%)

1yr Rtn -6.34 % (a much improved return from last week’s -9.8 %)


-Mutual funds

Through Thursday, May 26, 2016 the average U.S.Diversified Equity Fund gained a smidge from the previous week ending this week down only 1.29 percent year-to-date, according to Lipper.

You’ve got to look back 3 years, 2/28/13 through 5/26/16, to find a lip-smacking average return for this broad category of fund types. The average fund in that period of time was + 9.02 percent.

As an aside, following the Rule of 72, a 9 percent annual rate of return means  money doubles in value in 8 years. So $10,000 invested at a 9 percent rate of return would be worth $20,000 in 8 years. On the other hand, an investment earning a 1.39 percent rate of return would take about 55.8 years to double in value.

Back to mutual fund performances, of the 25 largest mutual funds around, the top three performing funds year-to-date through May 26, 2016 were all from the American Funds  Fund Family: American Fund ICA, +5.72 percent; American Funds CIB, +5.30 percent; and +American Funds Inc., 4.60 percent.

The worst performing fund over that same time frame was the Dodge & Cox Intl Stock fund, -1.29 percent.

Visit www.allaboutfunds.com for weekly updates to see how 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.

Lipper’s weekly performance figures for stock and fixed-income funds are at www.allaboutfunds.com in the left column on the home page.

  • Donald Trump says…

From where I sit, Donald Trump appears to have a lot of issues—- personally and professionally. In addition to his bullying behavior, the one that bothers me the most professionally has to do with money.

That five-letter little word means an awful lot to this presidential hopeful who boasts about his wealth but at the same time won’t disclose any real figures regarding his income, or, reveal his tax returns. Transparency, it seems, isn’t a part of the art of his deal.

That raises a red flag for me from an honestly and integrity level. It makes me wonder what kind of player this Commander-in-Chief wannabe would be for America and in the world arena.

In North Dakota last week, at a rally of his supporters, Mr. Trump told his audience that “you have to be wealthy in order to be great.”

Don’t believe that. It’s total hogwash.

America is a great country. Right now. Even as it is today.

Is there room for improvement in our country on a number of fronts ? Absolutely. But as many of us already know, throwing money at a problem doesn’t necesssarily solve it or make things better. We also know that rich leaders aren’t necessarily better leaders than those of lessor or minimal fortunes. And more importantly, that money doesn’t make a country great, rather it is the people who live in and govern the country that do.

So don’t let anyone try to tell you that what it takes to be great —or for America to be a great country— is money. That is both a lie and a cheap shot.