Author Archives: Mark Gordon

The FAANGs Bite Back

In 2013, financial TV host Jim Cramer popularized the acronym “FANG” referring to four large tech companies: Facebook, Amazon, Netflix, and Google. He grouped them because they had experienced outsized market gains. In 2017, commenters added Apple to the group and referred to the five companies as “FAANG” or “the FAANGs.” Although the long-term returns for these companies are solid, investors who piled into them based on the recent past have been treated to grievous losses.

2022: Year in Review
When is a “Bear Market” not a Bear Market?

Technically, a bear market occurs when stocks lose 20% or more of their value from top to bottom.³ But not all stocks go down in a bear market. Thus, when pundits refer to a “Bear Market,” they refer to a drop in the value of one or more major stock indices. Today we’ll examine the returns from other areas of the US market and explain why, despite the headlines, not all investors faced a bear market in 2022.

Q3 2022: Perspective on the Bear

Last quarter saw the bear market continue. Global stocks went down almost 7%¹ and US bonds lost almost 5%.² We’ve seen several positive indicators, but war, inflation and a potential recession have battered the markets. Recently a client asked me, given the bear market and bad news, “How can you be so calm?” In the moment, I said something to the effect of, “It’s a combination of belief and experience.” Since that conversation, however, I’ve been thinking more about the question, particularly in light of the “Bear Market Toolkit” we released last quarter.

Q2 2022: A Bear Market Toolkit

Last quarter was undoubtedly difficult for investors. Stocks went down across the globe. The US stock market dropped about 16%. In a pattern reversal, international stocks fared modestly better. Developed-foreign markets slipped 13% and emerging markets went down about 10%. Bond holders also experienced losses: the US bond market dipped almost 5%.

Diversification in Difficult Times

Markets were not kind to investors during the first quarter. Global stocks dipped almost 5.5%.1 Most all equity asset classes were down: US stocks dropped just over 4.5%, developed-foreign markets lost almost 6% and emerging markets went down almost 7%.2 In fact, across the major equity classes, we saw only two positive results.

2021: Year in Review

Reviewing “Year 2021” feels very much like reviewing Year 2020: We’ve faced a major market-disrupting event, we are individually and collectively battling COVID, many of us are struggling to adapt, and our future feels quite uncertain. Also like 2020, despite mass disruption and uncertainly, global equity markets rose substantially.

“The Markets Take a Breath”

Since COVID vaccines became available, clients have asked us questions along the lines of “How long can stocks go up,” “What’s going to happen once the pandemic is over,” or simply “What’s next?”  Most clients, by now, can anticipate our answer: we don’t know. Yet that doesn’t mean we don’t know anything. Although we can’t predict what the markets will bring, it appears to our eye the markets are currently digesting several global and/or macro events. Depending on how they work out, markets could go up or down from here. We’ll discuss each of these in order of likely importance.

“I Love it When a Plan Comes Together!”

Hurrah! After a very tumultuous year, Q1 2021 provided many equity investors plenty to smile about. Globally, stocks continued their upward trajectory. Unlike most of last year, however, large-growth stocks did not appear to drive the returns. Instead, we saw value and small companies come roaring back. Today we’ll review last quarter’s equity returns, explain what might be driving up value and small stocks, and examine whether we are at the start of a long-term trend.

Q4 2020: Year in Review

Where to begin in a review of 2020? A global pandemic. An oil price collapse. An impeachment trial. A market crash. Wildfires on the West Coast. Floods on the East Coast. Lockdowns. Mass unemployment. Olympic Games postponed. Nationwide civil-rights protests. A contested election. Even murder hornets. One could be forgiven for expecting an investment review

Q2 2020: Lonely at the Top

As you may know, our recommended portfolios typically have a mix of large and small, growth and value, domestic and international. Most clients opening their quarterly statements will see Q2 returns roughly consistent with their respective benchmarks. Looking at the trailing year, however, will likely paint a different picture. For the 12 months ending June