Q2 2015 Recap

Q2 2015 Recap

Where should we focus?

We experience mental challenges from many different directions when it comes to managing our finances. One of them is the media and how they focus on the bad news. They know dire headlines grab people’s attention and they are trying to get as many viewers as possible. A study cited at adweek.com found the average click-through rate on headlines with negative verbiage was 63 percent higher than positive stories.

It doesn’t surprise me that we pay so much attention to financial obstacles that might happen. Lately, many questions from people have sounded like this “I just read/heard/saw that this huge financial problem is going to happen soon. What do you think I should do about it?”

Answer: The reason why we create diversified portfolios is so we don’t have to time the market or guess what we should do if x, y or z might happen.

Asset allocation is meant to grow our money while protecting it from too much risk. Some people may not like that answer I gave above because it may seem vague and boring. But, this is a prudent way to invest and it is the principle I follow when managing client money.

It is always a good idea to remind ourselves to be patient, diversify our investments, understand how much risk we are willing to take, and look around obstacles for the opportunities.


Market Recap

The 2nd quarter definitely had its challenges. On a price basis REITs (VNQ) were down 11%, aggregate bonds (BND) -2.5%, energy (VDE) -2%, small caps (VB) -0.9% and the S&P 500 (VOO) -0.2%. Dividends made the S&P 500 slightly positive for the quarter at 0.26%


The month of April was positive but concerns emerged about the strength of the world economy, the Greece debt default, and higher interest rates. This new information pushed broad investments down in May and June. U.S. stocks dropped 1%, energy stocks -8.6%, REITs -6%, international stocks -5% and aggregate bonds -2%.

Data from Morningstar and Vanguard

What We Do

What We Do