The Conservative Portfolio fell -5.96% in September.
The S&P 500 dropped 8.91% in September, which was the second-worst single month for the index since we launched our model portfolios in April of 2002. (The worst month ever was September of that same year). While the Nasdaq was down just over 12%, investors in U.S. markets had a (gulp) relatively easy time of it. Foreign markets fell about 15% in September with emerging markets down around 20%.
Non-U.S. Government bonds have been as scary as stocks lately. The total bond market was down 1.34% last month - not too bad but considering that interest rates drifted lower a drop is not what would be expected. The real problem was in higher-risk bonds. Emerging market debt, which we haven’t owned in our model portfolios for years, was down almost 10%. High-yield (junk) bonds were down 7%. Mortgage-related debt continued to fall, and even “safe” municipal bonds were slipping. Our lower-risk bond-oriented portfolios suffered their worst one-month declines in September. Panic hit money market funds after one large fund “broke the buck.” Municipal money market funds started to yield 5% tax-free as buyers vanished. This may have turned into the panic of the century but the government started guaranteeing money market funds against default. Factoring in recent developments, the government is backing just about any kind of counterparty credit risk and is spending hundreds of billions to prop up financial institutions. Apparently there is no such thing as a free market.
We’d like to say the government intervention put a floor under stocks, but October is turning out to be far worse than September. The pessimism has gotten so high that we decided it was time to increase our stake in higher-risk bonds and stocks across all of our portfolios – a trade we sent out on October 10th, the day the Dow dipped below 8,000. This will not be our last trade if the market continues to deteriorate – though we are more aggressive now than we have been in years. We have trades planned all the way down to Dow 5,000.
Our model portfolios all fell in September, with declines ranging from 4% to 8%. This compares favorably with the S&P 500’s 8.91% hit, though we were disappointed in our more conservative portfolios last month. For the year, our portfolios are down from 4.2% to 12.5% compared to the S&P 500s 19.2% drop. Our strategy of buying when investors are running and selling when markets get hot has been working – our since inception total returns range from 42.2% to 85.38% compared to the S&P 500’s 14.36%.
Harbor Bond (HABDX) was hit hard for a relatively conservative bond fund in September - the fund dropped 3.88%. Bill Gross clearly went into some riskier debt, which has proved a little premature. We made the same mistake incidentally. So far, October isn’t looking much better for Harbor Bond.
Nakoma Absolute Return (NARFX) was almost flat for the month with a 0.32% drop. We’ll take flat in this market.
The Aggressive Portfolio fell -5.84% in September.
The S&P 500 dropped 8.91% in September, which was the second-worst single month for the index since we launched our model portfolios in April of 2002. (The worst month ever was September of that same year). While the Nasdaq was down just over 12%, investors in U.S. markets had a (gulp) relatively easy time of it. Foreign markets fell about 15% in September with emerging markets down around 20%.
Non-U.S. Government bonds have been as scary as stocks lately. The total bond market was down 1.34% last month - not too bad but considering that interest rates drifted lower a drop is not what would be expected. The real problem was in higher-risk bonds. Emerging market debt, which we haven’t owned in our model portfolios for years, was down almost 10%. High-yield (junk) bonds were down 7%. Mortgage-related debt continued to fall, and even “safe” municipal bonds were slipping. Our lower-risk bond-oriented portfolios suffered their worst one-month declines in September. Panic hit money market funds after one large fund “broke the buck.” Municipal money market funds started to yield 5% tax-free as buyers vanished. This may have turned into the panic of the century but the government started guaranteeing money market funds against default. Factoring in recent developments, the government is backing just about any kind of counterparty credit risk and is spending hundreds of billions to prop up financial institutions. Apparently there is no such thing as a free market.
We’d like to say the government intervention put a floor under stocks, but October is turning out to be far worse than September. The pessimism has gotten so high that we decided it was time to increase our stake in higher-risk bonds and stocks across all of our portfolios – a trade we sent out on October 10th, the day the Dow dipped below 8,000. This will not be our last trade if the market continues to deteriorate – though we are more aggressive now than we have been in years. We have trades planned all the way down to Dow 5,000.
Our model portfolios all fell in September, with declines ranging from 4% to 8%. This compares favorably with the S&P 500’s 8.91% hit, though we were disappointed in our more conservative portfolios last month. For the year, our portfolios are down from 4.2% to 12.5% compared to the S&P 500s 19.2% drop. Our strategy of buying when investors are running and selling when markets get hot has been working – our since inception total returns range from 42.2% to 85.38% compared to the S&P 500’s 14.36%.
Nakoma Absolute Return (NARFX) was almost flat for the month with a 0.32% drop. We’ll take flat in this market.
Harbor Bond (HABDX) was hit hard for a relatively conservative bond fund in September - the fund dropped 3.88%. Bill Gross clearly went into some riskier debt, which has proved a little premature. We made the same mistake incidentally. So far, October isn’t looking much better for Harbor Bond.
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The Conservative Portfolio fell -5.96% in September.
The S&P 500 dropped 8.91% in September, which was the second-worst single month for the index since we launched our model portfolios in April of 2002. (The worst month ever was September of that same year). While the Nasdaq was down just over 12%, investors in U.S. markets had a (gulp) relatively easy time of it. Foreign markets fell about 15% in September with emerging markets down around 20%.
Non-U.S. Government bonds have been as scary as stocks lately. The total bond market was down 1.34% last month - not too bad but considering that interest rates drifted lower a drop is not what would be expected. The real problem was in higher-risk bonds. Emerging market debt, which we haven’t owned in our model portfolios for years, was down almost 10%. High-yield (junk) bonds were down 7%. Mortgage-related debt continued to fall, and even “safe” municipal bonds were slipping. Our lower-risk bond-oriented portfolios suffered their worst one-month declines in September. Panic hit money market funds after one large fund “broke the buck.” Municipal money market funds started to yield 5% tax-free as buyers vanished. This may have turned into the panic of the century but the government started guaranteeing money market funds against default. Factoring in recent developments, the government is backing just about any kind of counterparty credit risk and is spending hundreds of billions to prop up financial institutions. Apparently there is no such thing as a free market.
We’d like to say the government intervention put a floor under stocks, but October is turning out to be far worse than September. The pessimism has gotten so high that we decided it was time to increase our stake in higher-risk bonds and stocks across all of our portfolios – a trade we sent out on October 10th, the day the Dow dipped below 8,000. This will not be our last trade if the market continues to deteriorate – though we are more aggressive now than we have been in years. We have trades planned all the way down to Dow 5,000.
Our model portfolios all fell in September, with declines ranging from 4% to 8%. This compares favorably with the S&P 500’s 8.91% hit, though we were disappointed in our more conservative portfolios last month. For the year, our portfolios are down from 4.2% to 12.5% compared to the S&P 500s 19.2% drop. Our strategy of buying when investors are running and selling when markets get hot has been working – our since inception total returns range from 42.2% to 85.38% compared to the S&P 500’s 14.36%.
Harbor Bond (HABDX) was hit hard for a relatively conservative bond fund in September - the fund dropped 3.88%. Bill Gross clearly went into some riskier debt, which has proved a little premature. We made the same mistake incidentally. So far, October isn’t looking much better for Harbor Bond.
Nakoma Absolute Return (NARFX) was almost flat for the month with a 0.32% drop. We’ll take flat in this market.
The Aggressive Portfolio fell -5.84% in September.
The S&P 500 dropped 8.91% in September, which was the second-worst single month for the index since we launched our model portfolios in April of 2002. (The worst month ever was September of that same year). While the Nasdaq was down just over 12%, investors in U.S. markets had a (gulp) relatively easy time of it. Foreign markets fell about 15% in September with emerging markets down around 20%.
Non-U.S. Government bonds have been as scary as stocks lately. The total bond market was down 1.34% last month - not too bad but considering that interest rates drifted lower a drop is not what would be expected. The real problem was in higher-risk bonds. Emerging market debt, which we haven’t owned in our model portfolios for years, was down almost 10%. High-yield (junk) bonds were down 7%. Mortgage-related debt continued to fall, and even “safe” municipal bonds were slipping. Our lower-risk bond-oriented portfolios suffered their worst one-month declines in September. Panic hit money market funds after one large fund “broke the buck.” Municipal money market funds started to yield 5% tax-free as buyers vanished. This may have turned into the panic of the century but the government started guaranteeing money market funds against default. Factoring in recent developments, the government is backing just about any kind of counterparty credit risk and is spending hundreds of billions to prop up financial institutions. Apparently there is no such thing as a free market.
We’d like to say the government intervention put a floor under stocks, but October is turning out to be far worse than September. The pessimism has gotten so high that we decided it was time to increase our stake in higher-risk bonds and stocks across all of our portfolios – a trade we sent out on October 10th, the day the Dow dipped below 8,000. This will not be our last trade if the market continues to deteriorate – though we are more aggressive now than we have been in years. We have trades planned all the way down to Dow 5,000.
Our model portfolios all fell in September, with declines ranging from 4% to 8%. This compares favorably with the S&P 500’s 8.91% hit, though we were disappointed in our more conservative portfolios last month. For the year, our portfolios are down from 4.2% to 12.5% compared to the S&P 500s 19.2% drop. Our strategy of buying when investors are running and selling when markets get hot has been working – our since inception total returns range from 42.2% to 85.38% compared to the S&P 500’s 14.36%.
Nakoma Absolute Return (NARFX) was almost flat for the month with a 0.32% drop. We’ll take flat in this market.
Harbor Bond (HABDX) was hit hard for a relatively conservative bond fund in September - the fund dropped 3.88%. Bill Gross clearly went into some riskier debt, which has proved a little premature. We made the same mistake incidentally. So far, October isn’t looking much better for Harbor Bond.