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We wanted to take this opportunity to reassure our investors and review some of the recent headlines.
On Friday, the Dow Jones Industrial Average slid into "Bear Market" territory (down 20% from the highs last year) with investors concerned about the rising price of oil and continued mounting credit losses in the financial sector.
These developments are indeed worrisome; however, we were not caught unaware, and we continue believe that your investments have been positioned appropriately for the volatility we are experiencing.
The U.S. Treasury Index we own is performing as expected; maintaining value, while paying a respectable dividend, anchoring the portfolio during these difficult times. Our other investment, Blackrock Global Allocation, is minimizing volatility by overweighting Energy and Healthcare and underweighting Financials & Consumer services.
We continue to look for opportunities in these difficult times, and when appropriate will begin a cautious foray back into the markets. For now though, we will continue our defensive positioning while searching for an appropriate entry point.
As always please contact us with any questions or concerns.
Sincerely,
Craig P. Kelley Sean P. O'Hara
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* Performance information stated above is for the one year time period, January 1, 2008 through December 31, 2008, from December 31, 2008 through January 31, 2009, and from inception, March 31, 2006 through January 31, 2009, as is indicated. Performance information is for Kelley Investments Managed Accounts Program where client accounts are managed on a discretionary basis. Not all accounts managed by Kelley Investments are part of the discretionary Managed Accounts Program. Performance information stated above does not pertain to any accounts that are not part of the Managed Accounts Program. Performance results for accounts that are not part of the Managed Accounts Program may differ significantly. Performance information quoted above represents past performance and is not a guarantee of future results. Performance information is quoted on a Gross basis and does not include deductions for management fees or trading expenses. If these fees and expenses were taken into account, performance would be lower. The investment return and principal value of investments in the Managed Income & Growth or Managed Growth Portfolios will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost.
**For illustrative purposes only. It is not possible to invest directly in an index. Comparisons with the S&P 500® Index are not meant to be indicative of any of Kelley Investments Managed Portfolio strategies, asset composition or volatility. Given the wide scope of securities held by S&P 500, it should be inherently less volatile. Our results may differ markedly from those of the S&P 500 in either up or down market trends. The performance of the S&P 500 is shown with all dividends reinvested into the index and does not reflect any reduction in performance for the effects of transaction cost or management fees.
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Conference Call
To listen to a replay
of our
January 12, 2008 Conference Call, dial (877)471-6587
and enter Program ID 1038358075004#
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Craig P. Kelley offers Investment Advisory Services through Kelley Investments, A Registered Investment Advisor. Client assets are held in custody at Fidelity Investments clearing firm, National Financial Services LLC (NFS).
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