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Oakland, CA | East Bay; First & Main Financial 3rd Quarter Market Summary

BY: ALISON VAN DYKE, FIRST AND MAIN FINANCIAL

Q3 2021 Market Summary:

2.29% – U.S. momentum stocks

-3.60% & -8.49% – Emerging markets (small & profit) stocks

-1.05% – International profitability stocks

0.53% – U.S. large stocks                                                       0.78% – Global high yield bonds

0.37% & -4.92% – U.S. small (value & profit) stocks           -0.69% – CA municipal bonds

-0.29% – U.S. Hi Relative Profitability                                  0.41% – Core bonds

YTD 2021:

10.32% – U.S. momentum stocks

13.64% & -5.79% – Emerging markets (small & profit) stocks

9.33% – International profitability stocks

16.34% – U.S. large stocks                                                     14.51% – Global high yield bonds

32.17% & -3.52% – U.S. small (value & profit) stocks         0.84% – CA municipal bonds

11.81% – U.S. Hi Relative Profitability                                 0.16% – Core bonds

September is the worst month for our stock market with average returns of -1.00% (measured by the S&P 500 (-1.75% in 2021)). While many have October burnt into memory as a bad month for stocks, October can be the month where negative momentum in September carries into heightened October volatility and tired trends come to an end in a dramatic show.

October actually scores average returns of 0.40% (since 1928) and can be thought of as having the potential to start a fresh market cycle. These trends don’t always hold, and there’s no way to put together a set of “predictors” that would allow one to profit on the long run averages. It is, however, fair to consider the potential that when we have a bad September, and the downside pressure carries into October, it might actually be an opportunity to put more capital to work or just not let the downside cause you stress. Market corrections are normal and healthy.

Of course, there could be larger systemic factors at play that may be cause for worry, but because we can’t predict the future, what’s always worked in the past has been to stick with an investment program that aligns with your personal circumstances. Reactionary actions taken in a portfolio that are driven by fear can cause irreparable damage.

There are issues of concern like inflation and the fact that we seem to be headed down a path pretending like it won’t be a problem. Current policies are promoting higher gas prices, a labor shortage and even greater governmental spending after a massive spree during lockdowns. Inflation disproportionately harms those at the bottom of the economic ladder, especially those on a fixed income.

Current Chinese aggression towards Taiwan isn’t helping global tensions.

On the positive, businesses need millions more workers which is a sure sign of strength. Millions of Americans have also put themselves in a stronger financial position after feeling a prolonged sting from the 2008 financial crisis. We came into the pandemic in one of the best economic periods in the history of our country, something not achieved for over 50 years. We’ve come through the pandemic on very solid footing but global supply chain challenges remain which is proving to be another driver of current inflation.

We’re watching and available to take actions with you, or on your behalf, if appropriate or if circumstances have changed for you.

As always, we appreciate the trust you put in us to manage your investments. We are always available for a conversation should questions arise or you simply desire to connect with us for a few minutes to just say hello.

Sincerely,

Erik S. Wolfers, MBA, CFP®

“Best Financial Advisor in Piedmont, CA”

Top Rated Local Financial Advisor / Planner

East Bay Area: Piedmont, Oakland, Berkeley, Alameda, Orinda, CA

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“Best Financial Advisor in Piedmont, CA”

Top Rated Local Financial Advisor / Planner

East Bay Area: Piedmont, Oakland, Berkeley, Alameda, Orinda, CA

CityScoop is the top ranked local business news network in the United States. Established in 2008, CityScoop has been providing local communities with high quality news about local businesses and their most recent projects.

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ALISON VAN DYKE

FIRST AND MAIN FINANCIAL

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235 Wildwood Avenue,
Piedmont, CA 94610, USA

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ABOUT THE AUTHOR

BIO: At First & Main Financial, Alison Van Dyke helps clients with their financial lives. She has worked in Corporate Finance for Bank of America and Chase Manhattan Bank. Alison is pursuing the CFP® certification; she received her MBA at Georgetown and her B.A. in Political Science from UCLA.

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Oakland, CA | East Bay; First & Main Financial 3rd Quarter Market Summary