Benchmark Returns for the Period Ended
September 2021
| Quarter | Annualized | |||
|---|---|---|---|---|
| 1 Year | 5 Year | 10 Year | ||
| US Treasury Bills (one month) | 0.01% | 0.05% | 1.06% | 0.55% |
| Barclays Capital US Gov’t/Credit Inter Bond | 0.02% | -0.40% | 2.60% | 2.52% |
| Standard & Poor’s 500 | 0.58% | 30.00% | 16.90% | 16.63% |
| Russell 1000 Value (large cap value) | -0.78% | 35.01% | 10.94% | 13.51% |
| Russell 2000 (small cap) | -4.36% | 47.68% | 13.45% | 14.63% |
| Russell 2000 Value (small cap value) | -2.98% | 63.92% | 11.03% | 13.22% |
| MSCI Europe, Australasia and Far East (EAFE) | -0.45% | 25.73% | 8.81% | 8.10% |
| MSCI Europe, Australasia and Far East (EAFE) Small Cap | 0.90% | 29.02% | 10.38% | 10.73% |
| MSCI Emerging Markets | -8.09% | 18.20% | 9.23% | 6.09% |
| Wilshire REIT | 1.64% | 38.04% | 6.97% | 11.30% |
| Source for returns: Morningstar TM as of 9/30/2021. | ||||
Quarterly Commentary
After five consecutive quarters of strong returns, the global equity market rally paused during the third quarter, with a downturn concentrated in the last two weeks of September. On the positive side, Real Estate Investment Trusts (REITs) led the way, returning 1.64% (per the Wilshire REIT Index). This was followed by international small company stocks, with a return of 0.90% (per the MSCI EAFE Small Cap Index). Emerging markets were the worst performer, returning -8.09% (per the MSCI Emerging Markets Index) as concerns about economic growth in China came to the forefront.
This quarter saw a mix of good and bad economic data. Globally, demand for goods and services remains strong, but supply chains still struggle to meet demand. The COVID recovery remains uneven from country to country, impacting the availability of everything from computer chips to heavy industrial machinery. This has led to price increases across the board, which markets are still digesting. It is important to note that, for most industries, the issue is not lack of growth in demand but rather constraints in meeting that growing demand. Even with these constraints, the Federal Reserve forecasts economic growth for the third quarter at 2.3% annualized1.
Washington, D.C. has also been in the news, as lawmakers are currently negotiating everything from infrastructure spending to tax increases and the debt ceiling. Finding common ground to pass meaningful legislation remains elusive, so politics will remain front and center for at least the remainder of the year and will likely contribute further to the recent volatility.
As the saying goes, the more things change, the more they stay the same. Know that your team at RCG is focused on your long-term goals and will remain steadfast in helping you navigate what lay ahead.If you have thought about becoming a client or would like a second opinion on your current holdings, please contact us via the button below and we would be glad to assist you in achieving your financial goals.PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. Indices are not available for direct investment; therefore their performance does not reflect the expenses associated with the management of an actual portfolio. The index returns above assume reinvestment of all distributions. This information is for educational purposes only and should not be considered investment advice or an offer of any security for sale.
1. Federal Reserve Bank of Atlanta GDPNow dataset as of 10/1/2021
