2015 Market

As we start the New Year it is good to look back and review the past 12 months. It would appear that we are in a global slow growth environment. The 2015 markets were flat for the year with parts (emerging markets) being sharply down. The Morningstar broad index was up .69%, the Russell 2000 was down -4.41%, the DOW up .21% and the S & P 500 up 1.38%. After a year like this it is very easy to ask, “Why am I in the market?” Fortunately I have a good answer. I will use the Morningstar index for my example but any of the above indexes will make the same point.

YEAR RETURN
2011 1.58 %
2012 16.27 %
2013 33.13 %
2014 12.85 %

If we look at all the investment options, only owning your own business or investing in rental real estate can you match the returns of a balanced stock and bond portfolio at this point in time. However, I would point out that owning a business or managing real estate rentals is no easy task. So while Bill, Keith and I don’t enjoy flat or down years such as this one we will continue to invest as we always have. We are firm in our belief that over time a diversified portfolio is one of the best places to store and grow your hard earned capital. Remember these are indexes which are 100% invested in stocks so your return will vary from these figures by the % of your funds that are in the bond market, overseas, or in other diversifying areas.

If you have not seen “The Big Short” I would ask you to go see it. It is an eye opener, and if enough people become aware of the things that are going on maybe we can stop it. For the year ahead we will be watching the markets closely as we appear to have a market which is becoming more and more tied to one another. We will do our best to make good decisions for you.

In closing, Integra Financial, Inc. celebrates its 25th year. I hope you had a good Holiday Season and we wish you good health and prosperity in the New Year.

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