2020 Year End Performance (Video)

Video On The Topic and Blog Below:

Much to everyone’s surprise most investors did fine in 2020.  The US stock market as measured by the S&P 500-stock index, ended up more than 18 percent.  While we continue to remind you that you are not solely invested in the US stock market, the Atlas Fiduciary portfolios ended positively as well, although driven by other factors.

 By mid-year it did not look good. Our most invested model, one targeting moderately aggressive growth did not even recoup the losses experienced in March (see chart below).  But by the September the various asset classes in the model began to come to life and we saw a rebound which resulted in a return of more than 11%.  The interesting thing is that most of this growth all happened in the fourth quarter of the year.

In reviewing where this growth came from we can see convertible bonds and mid-cap bonds surpassed the returns of Large Cap US equity.  The asset classes which underperformed were Natural Resources and Real Estate.  While we know we will always participate in the top performers and in the under performers, we never know which assets will be in either category.  This continues to validate the need for broad exposure as well as the need to remain fully invested in all of the asset class choices.   Over the long-run it has been empirically shown to produce the highest increase in dollars terms, which is different than the average return, a conversation for another blog.