What a difference a month makes. The last few months have been pretty abysmal for stocks, both US and International. If you are looking at just Emerging Market stocks then it's more like the last five months. No matter which way you look at it, it's been rough. Well, all that changed this month as stocks of every category rallied back. Some now positive for the year while others getting close to even. We talked about how a lot of money flowed out of stock mutual funds last month, let's hope you weren't one of the sellers and strictly adhered to your plan rather than emotion.
Let's take a look at the numbers. All of the US stock categories were up between 5% and 9%. US large cap stocks, core and value, fared the best up 8.41% and 8.01%, respectively. US small cap stocks were up but not as much, small cap value up 5.55% and small cap core up 5.91%. This could mean people are still nervous and as they did start buying again looked to the safety of large cap stocks over small. Despite the increase this month only US Large Cap Core is up year-to-date. But if we have another month like October, all the other stock categories will reach positive territory soon.
International stocks performed almost as well, up between 5% and 8%. International large cap both core and value were up just under 8%. International small cap stocks, both core and value, were up about 6%. International small stocks are now up for the year.
Finally, Emerging markets, the worst performer of the year, was up 7.05% in October but still down (11.35%) year-to-date.
Short-term bonds was the only asset, that we track, that was down for the month, but only just slightly (0.16%). Bonds have earned you just over 1% year-to-date.
Jim, are you happy about the recent change in the markets?
"Happy isn't the right word. While many people are happy when the markets are up and nervous when the markets are down, that's not the best way to view it. Over the long-term markets go up. That's just how it works. Knowing this you can be happy when markets are up and things are as they should be. But you can also be happy when markets are down, knowing it's only temporary, and even better, an opportunity to make your stock purchases at a discount. Therefore, you could say I am no more or less happy than I was last month, and am still just as optimistic for the future."
I didn't think of it that way. Most intriguing, Jim.
Here's the monthly return numbers with stock charts:
October Returns By Asset Class
US Large Cap Core: 8.41%
US Large Cap Value: 8.01%
US Small Cap Core: 5.55%
US Small Cap Value: 5.91%
International Large Core: 7.87%
International Large Value: 7.28%
International Small Core: 5.91%
International Small Value: 5.78%
Emerging Markets: 7.05%
Short Term Bonds: (0.16%)