Performance Report: 11/30/2022
All performance data for our strategies is net of all fees and expenses. All performance data for indexes or other securities is from sources we believe to be reliable. All data is as of 11/30/2022.
We had a nice month in November with our average account appreciating right at 2%. For the year, our average account is down just 4.4% compared to a 12% YTD decline for both our benchmarks, AOM and our Global Balanced Index. Since inception, we continue to far outpace our benchmarks delivering superior gains on both an absolute and risk-adjusted return basis.
In November, stock markets continued their rebound from October. The S&P index appreciated nicely in November clocking a gain of nearly 5.5%. This coupled with last month's strong returns led to the index recovering over half its earlier declines. For only the second time this year, US Treasuries experienced a monthly gain. Bond funds across the board are still deep in the red this year with losses well into the double digits but there was a slight bit of relief in November. Unless equities continue their upward trajectory, 2022 will be the first time in stock market history that both equities and bonds depreciated more than 10% in a calendar year.
The daily volatility in the stock markets has continued at an elevated rate. The average daily volatility for the S&P 500 in November was 1.73%, more than double the 0.83% average from 2021 and more than three times the average from 2019 which was 0.54%. This past month was even more volatile than November 2020 when there was a major power shift in DC and an approved Covid vaccine was announced! Suffice it to say, market participants are struggling mightily with the conflicting forces taking hold of the capital markets. Bulls and bears and duking it out. Buyers won this round but thus far this year, the scorecard strongly favors the bears. As an investor who is agnostic towards the market's direction, this volatility is telling me we need to continue to be really careful. There is so much money sloshing around in the capital markets, it's important to participate on some level but risk management is more keenly important today than it has ever been in the past.
To be continued...
There is quite a bit going on in the markets that I would like to address further but I'll have to do it with a follow-up later in the month. I need to organize my thoughts. I'm seeing some potentially significant developments that are too obvious to ignore. Mr. Market has a tremendous poker face and it's not often that he tips his hand. But occasionally, he does and when he does, we need to be ready to pounce. Now maybe one of those times. It is a bit too early to tell but the next couple of months could prove interesting. I'll follow up in the next couple of weeks when I have a chance to properly explain what I see and how we can profit from it.
As always, please do not hesitate to call me at 512-553-5151 if I can be of assistance.
1) Inception date of 4/30/2019
2) All benchmark prices are obtained through the Yahoo!Finance website. S&P 500 Index is calculated using the index price. AOM is the iShares Core Moderate Allocation ETF. Global Balanced is calculated using a 40% allocation to SPY, 40% allocation to BND and a 20% allocation to IEFA.