This past week, April 17-21, both stocks and bonds were higher, while the price of oil fell by almost 7%, as the beginning of the first-quarter earnings season led to a choppy week for the markets. Key support to higher stock prices is optimism about the Trump administration’s pro-growth policy changes. Stock markets initially reacted positively to President Trump’s agenda after the election, posting all-time highs at the prospects of more business-friendly regulatory, tax and economic policies. However, more recently markets have retreated, as concerns about global political tensions and growth have weighed on investor sentiment. This coming week will mark President Trump’s first 100 days in office, and reports are that his tax plan is to be released this coming week as well. That will impact the markets greatly once released.
Last Week’s Stock and Bond Index Performance (April 17-21, 2017)
- NASDAQ 1.8% (YTD 9.8%)
- Dow Jones Industrial Average 0.5% (YTD 4.0%)
- S&P 500 Index 0.8% (YTD 4.9%)
- U.S. Aggregate Bond Index 0.1% (YTD 1.8%)
How did my retirement portfolio perform last week (April 17-21, 2017)?
Below is a snapshot of my three biggest retirement portfolio mutual fund movers in terms of percentage gained last week.
The below mutual funds are held within my work 401(k) plan as well as two separate Roth IRA plans. I currently invest 15% of my income into my company Roth 401(k), and that doesn’t include the company match I get. All accounts are held with Vanguard (so as you can see I primarily invest in Vanguard funds because of this).
- DFA US Small Cap Value Index Fund (DFSVX) 2.7%
- Vanguard Small Cap Value Index Fund (VSIAX) 2.1%
- Vanguard Extended Market Index Fund (VEXAX) 2.0%
Can I Beat the Stock Market?
I am actually not trying to “beat the market” with my retirement portfolio…I am trying to match it. I do have alternative indexes in my retirement portfolio to help possibly beat the market, e.g. Small Cap Value, REITs, International, and Emerging Markets. Through lots of reading and research on my part, I’ve found that a number of these assets classes “zig” when the market “zags”. I am purposely over-weighted in Small Cap Value, which at times helped me beat the market and at the same time lag the market.
With that said, if I can beat the market I will absolutely take it (obviously)! Last year in 2016 my retirement portfolio returned 13.01% versus 9.54% from the S&P 500. The primary reason I was able to beat the market last year was due to the strong performance of my Small Cap Value holdings, which I am weighted heavily in.
Thus far in 2017, which is 112 days, my retirement portfolio is up 4.19% versus 4.91% from the S&P 500. So while I beat the market in 2016, I am now lagging it ever so slightly (early on) in 2017. But I am investing for the long term so this doesn’t concern me, as long as I am within reason of the market (within 1%). And actually, within the last 30 days I am beating the market. My portfolio is up 1.05% in the last 30 days versus the S&P 500 being up only 0.12%. The 30 day and the first part of 2017 views are quite short sighted in terms of long term investing, but I like to monitor this as a baseline for my retirement performance and how I compare to the market.
I am a liberal arts major and I am my own financial advisor. My goal with this personal finance blog is to show all Millennial’s that you have the power to take control of your personal finances through self-education on money and finance, and by striving to become financially literate. That is what I have been doing for years now, focusing on becoming very financially literate, so I can one day become financially independent. I’m trying to prove to Millennial’s that we can all do this and thrive with money. Follow my blog as I highlight relevant personal finance topics pertaining to us Millennial’s.