|
Join Our List
|
|
Have a friend who may find this interesting?
|
|
|
|
| Greetings!
Thank you for interest in the Blue Haven Capital newsletter. We welcome your questions and comments and can be reached via email at info@bluehavencapital.com
|
Question: By the end of February 2009, US Treasury bonds had outperformed stocks over what period of time?
10 years
20 years
40 years
Click here for the answer!
|
| THE MARKETS
|
|
Stock index performance (Domestic and International)
as of 05/22/2009
Domestic Index Performance Year to Date:
Dow Jones Industrial Average................ -4.19%
Standard & Poor's 500..........................-0.68%
Russell 2000.......................................-3.72%
Domini 400 Social Index........................+1.11%
International Index Performance Year to Date:
MSCI Japan (in $US)............................-0.55%
MSCI Pacific xJapan (in $US).................+8.93%
MSCI Latin America (in $US)..................+39.56%
MSCI EAFE (World xUS in $US)...............+8.02%
Current Interest Rates:
10 year US Treasuries...........................3.41%
10 year AAA rated municipal bonds..........2.80%
|
|
BLUE HAVEN CAPITAL LUNCHEON
|
|
Blue Haven Capital presents Jimmie Alford
Join us for a luncheon geared towards Nonprofit Executives, Board Members, staff, volunteers, and donors! Blue Haven Capital is holding its next quarterly luncheon on Friday, June 5th at Niche Restaurant in Geneva. Our speaker will be Jimmie Alford, LL.D., LH.D., the Founder and Chair of The Alford Group. Jimmie has been recognized twice by The NonProfit Times as "one of the 50 most influential people in the nonprofit sector" and is the recipient of The Association of Fundraising Professionals' prestigious Chair's Award for Outstanding Service for 2009. He writes and lectures extensively on issues affecting the not-for-profit sector. The Alford Group is one of the premier consulting groups in the country and provides leadership in improving the quality of life by serving not-for-profits. The firm has worked with more than 3000 organizations of all budget sizes and missions. The cost of the luncheon is $25 and will take place from 12-1.30pm on Friday, June 5th at Niche Restaurant, 14 South Third Street in Geneva, IL. For reservations, please call Niche Restaurant at 630.262.1000. Seating is limited and reservations are required.Please come for good food, a gathering of peers, and to learn new strategies for the nonprofit world. |
| STANDARD & POOR'S SPIVA REPORT
|
|
Active versus passive mutual funds
Standard & Poor's recently released the annual "S&P Indices Versus Active Funds (SPIVA) Scorecard report- and all 28 pages may be found here. Once again, Standard & Poor's found that low cost index stock mutual funds outperformed most actively managed stock mutual funds across all sectors and in both bull and bear markets. 72% of large cap funds, 79% of mid cap funds and 85% of small cap funds underperformed their corresponding indices over the previous 5 year cycle.
Lately we have heard some brokerage firm advertisements that they "really earn their fees" in bear markets and that they outperform the index funds when times get really tough. Well, the statistics from both the 2008 bear market and the 2000-2002 bear markets prove otherwise.
A longer term study called "False Discoveries in Mutual Fund Performance: Measuring Luck in Estimating Alphas" - all 73 pages may be found here- came out in 2005. That study looked at the stock market from 1975 through 2005 and concluded that fewer than 1% of mutual fund managers over the long term had any sort of "stock picking" ability whatsoever. In its conclusion, the study says "...unskilled fund managers have increased substantially in the population over this period." The study wonders "...why investors seem to increasingly tolerate the existence of a large minority of funds that produce negative alphas, when an increasing array of passively managed funds have become available..."
Our recommendation? Buy the lowest cost passively managed index funds available in the market. Get index fund exposure in the small, medium, and large cap sectors. Get index fund exposure in both the domestic and international markets. Get index fund exposure in both growth and value companies. According to both short and long term studies, an investor using this approach will outperform the majority of expensive, actively managed mutual funds.
Blue Haven Capital continues to seek the least expensive, most cost efficient method of gaining stock market exposure for its individual and institutional clients. We would welcome the opportunity to discuss this method with you or those who you think might appreciate our low cost approach.
|
| 2009
|
|
Looking Ahead
The stock market's volatility has come down 40% over the last 6 months as measured by the VIX Index at the Chicago Board Options Exchange. Five year Treasury rates have moved from 1.30% to 2.20%, while 30 year Treasury rates have gone from 2.60% to 4.40%. Inflation is not right around the corner, but it is somewhere out there on the horizon.
As the economy slowly recovers, the stock market will still suffer bouts of dramatic price change. However, Blue Haven Capital is cautiously optimistic about the economy and is working to lessen the effect that increased inflation will have on our client portfolios.
As always, we thank our clients and supporters for the confidence you have given us.
|
|
Blue Haven Capital is a fee-only registered investment advisor providing experienced, professional low cost investment management for individuals, associations, private foundations, and public charities. If you know an individual or group who might be interested in our services, please forward this email to them!
Best Regards,
Donald Cummings Bill Moucka
Principal Principal
Blue Haven Capital LLC
630.588.3800
|
|
|
|
