In Like a Lion...Out Like a Lamb

That old phrase about the weather in March could roughly describe the experience of most of our clients in the final month of this quarter. After precipitous declines in both January and February, the domestic stock market reached new lows in early March, foiling the hopes of many that the low reached in late November last year was “the bottom”.

The remainder of March, however, saw an almost uninterrupted recovery of values to produce one of the strongest single months in many years. This much better tone continued into the first days of April, as economic reports continue to look somewhat brighter and the G-20 meeting in London seemed to produce some commonality in global response and a continued, if guarded, acceptance of American leadership.

But, the March come-back was not enough to overcome the severe losses earlier in the quarter. Overall results for the quarter were still very disappointing with most clients’ portfolios suffering losses in the high single digits to low double digits. Many portfolios benefited from allocations to fixed income, of course, to soften this blow; and client portfolios with allocations to emerging markets – the only equity asset class that posted positive returns for the quarter – were among the better results. continue story

“Will I ever get it back?!”

The dramatic plunge in equity investment values across asset classes that began in mid-2008 and continued through much of the first quarter of 2009 has had a devastating effect on investment portfolios. During the last client conference call that Aspiriant hosted on February 27th, we addressed questions about near term prospects for the market and the economy. During that call, Jason Thomas, Aspiriant’s Chief Investment Officer, also made a brief mention of the dimensions of market performance that would be required in order to achieve the same wealth goals expressed by our clients prior to the precipitous declines. It is difficult to avert our immediate attention from the volatility, fear, and glimmers of hope that characterize our current market and economy. Still, as our clients’ portfolios are built to endure for the long term, we believe a deeper discussion of the impact of a range of recovery scenarios is important for developing confident and actionable expectations about the future. read more

DFA – Has the Ivory Tower Collapsed?

The manager results table of this and recent issues of Insight show that a number of Dimensional Fund Advisor (DFA) funds have underperformed their relevant benchmarks, in some cases by a material amount, over the last 1–3 years. In response, some clients have justifiably asked whether the DFA funds or separately managed accounts are still an appropriate portfolio component. This presents a good opportunity to remind our clients of our beliefs regarding the role of public equities in clients’ investment portfolios generally and, specifically, DFA’s* role in implementing the public equity allocations. read more

*DFA and the securities it offers are just a component of our currently recommended managers and securities used in portfolios. We will provide a complete list of recommended securities upon request. DFA’s funds or accounts are available only through institutional channels such as Aspiriant.