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Equity and bond markets rose in the first half of 2014 and for the second quarter, continuing their ascent after 2013′s strong year of market returns. As we review the first half performance of stocks and bonds across various categories, index-based strategies continue to lead the way. While the average diversified U.S. stock fund returned 4.9% in the first six months of the year, the Dow Jones Total U.S. Stock Market Index returned 6.97%. Over the past one-year and five-year periods, the Dow Jones Total U.S. Stock Market Index performance has beaten the average U.S. stock fund by 2.3% and 2.1%, respectively. International stock funds rose 5.2% year-to-date and 2% for the most recent quarter, while intermediate term bond funds increased 4.1% this year.
When a portfolio performs worse than benchmark targets, it’s performance error, and our discussion on why it is so harmful to retirement savings has been a recurring theme on our blog, in seminars and overall education with our clients and others. We’re on a mission to make sure that investors are able to diagnose when they are suffering from performance error, and to be part of the solution to the problem of underperformance driven by higher costs and lackluster active-management.
The enormous amount of performance data now readily available over short and long run periods is more evidence that low-cost investment strategies that blend exchange-traded funds together are superior for your portfolio. After factoring in management fees, taxes and trading costs, the power of smarter investing through lower costs and index-driven science is clear.
Have a great weekend!
Disclosures:
All investing is subject to risk, including possible loss of money invested. Past performance is no guarantee of future results. Index performance is not reflective of an actual investment return as you are unable to invest directly in an index.
TruNorth Capital Management, LLC (TruNorth) is an investment advisor registered in, and regulated by, the State of Michigan. All clients and potential clients have access to important information about our business methods, fees, professional qualifications and all other pertinent business information.
TruNorth Form ADV Part 1
Form ADV Part 1 is a regulatory filing that provides the basic business structure of TruNorth and explains how we are legally registered.
TruNorth Form ADV Parts 2A & 2B
Form ADV Parts 2A & 2B provides details of the services we offer as well as the backgrounds of TruNorth's principals. It also includes information about our fees, investment strategies and how we conduct our business. See below to download Form ADV Parts 2A & 2B.
Click here to access Form ADV Parts 1, 2A and 2B from the SEC website. |
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