December 2015 Market Insights

January 4, 2016

2015 Year in Review

With most market indexes flat to negative in 2015, investors have been left wondering if there was any place they could have put their money this year that would have delivered respectable gains. The answer is that there were some places that made significant money, but they were very few and far between. In fact, Bloomberg has penned 2015 “The Year Nothing Worked.”

Significant price increases were limited to individual stock holdings (i.e. Netflix, Amazon, Google), or sector-specific holdings (think healthcare and information technology). Of course, few investors have large exposures to individual stocks or sectors, and even fewer had exposure to the correct stocks or sectors in 2015. Most investors, instead, diversify their portfolios in terms of asset classes: namely, stocks, bonds, cash, and commodities.

As referenced by the Bloomberg article below, in any given year, there is usually at least one asset class that produces returns in excess of 10 percent—that was not the case in 2015. The best that anyone could do was to be fully invested in stocks, and this strategy would have only eked out a modest gain. Every other asset class was flat (cash), negative (bonds), or dramatically negative (commodities).

You can read the rest of the article here: http://www.bloomberg.com/news/articles/2015-12-28/the-year-nothing-worked-stocks-bonds-cash-go-nowhere-in-2015

Here is a recap of index returns for the 2015 calendar year:

IndexDecemberYTD5 yr Annualized
 MSCI World Ex USA (international stocks) -1.79% -3.04% 2.79%
 S&P 500 (US large cap) -1.58% 1.38% 12.57%
 Russell 2000 (US Small cap) -5.02% -4.41% 9.19%
 Barclays US Aggregate Bond -0.32% 0.55% 3.25%
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