Why your Year to Date Returns may be Negative
While year to date returns are very much in line with target objectives for most clients June was a negative month from almost all perspectives. Most clients will have a negative return for June for the following reasons:
TSX was down 1.86% for the month
SP500 was down 4.99% for the month (CDN$ version)
Global equity markets for CDN investors was down 5.36% for the month (as represented by I-shares XAW)
CDN$ gained 3.74% against the US$ in the belief Canada would be raising rates sooner than expected (negative for most clients.
Bonds lost about 1.11% of their value (as represented by the TD BOND FUND).
The chart below gives an idea of clients returns year to date based on their TARGET ASSETS ALLOCATION. It is important to know your average target return and the asset allocation associated with that target rate of return.
Benchmark comprised of:
A bad month after 5 decent months is NORMAL and should be EXPECTED. We do not appear to be near a recession so most pullbacks should be shallow and temporary in nature.
Rising rates represent as much ‘danger’ to many clients as falling equity markets as bonds and bond funds drop in value (temporarily) while current interest rates move higher.
Those with current cash flow requirements need to plan properly to ensure market volatility, both in bonds and equities does not disrupt their objectives by forcing them to sell positions that are down.
I strongly encourage those that have not had a planning/review meeting in the last 60 days to arrange a time to meet. You can call or e-mail myself or Gayle to arrange a time.
The information and opinions contained herein have been compiled or arrived at from sources believed reliable but no representation or warranty, express or implied, is made as to their accuracy or completeness. Neither Argosy nor its affiliates accepts any liability whatsoever for any loss arising from any use of this report or its contents. This report is not, and is not to be construed as, an offer to sell or solicitation of an offer to buy any securities and/or commodity futures contracts. The securities mentioned in this report may not be suitable for all investors nor eligible for sale in some jurisdictions. This research and all the information, opinions, and conclusions contained in it are protected by copyright. This report may not be reproduced in whole or in part, or referred to in any manner whatsoever, nor may the information, opinions, and conclusions contained in it be referred to without the prior express consent of Argosy.
‘historical analysis does not reflect future returns’