The Week in Review: Performance updates from Cabana’s CEO – April 10, 2018
Market insight and a highlight of Cabana’s year-to-date performance:
Cabana’s seven portfolios range from “Conservative” to “Aggressive” and include an income strategy and an “Accumulator” portfolio. Performance is as of market close on April 9, 2018 and is presented net of maximum advisory fees and commissions.
All Cabana Portfolios were up over the past week, ranging from +.02% (Growth) to +1.69% (Accumulator).
Equity Markets continue to be remarkably volatile. We continue to see swings of greater than 1% in all major indexes daily. Between rising interest rates, trade tariffs, and U.S political uncertainty at the highest levels, “traders” have taken over for “investors” and are running the show. I saw an interview with legendary investor John Bogle this week. Mr. Bogle is the founder of Vanguard and has been investing professionally for more than 66 years. He was asked about this year’s extreme volatility and replied that in all his years in the markets he has never seen the sustained and violent moves in price that we are now seeing. To put that statement into context, he pointed out that he has lived through two 50% corrections, numerous 25% corrections, as well as the crash of 1987, when the market dropped 20% in a day. Wow! That is really saying something. The follow up question posed to him was, “So, what do you do in this environment?” His answer is as poignant as it is timeless. He stated, “Volatility is of interest to speculators, not long-term investors.” What Mr. Bogle is confirming is that long-term investors are only interested in what ultimately drives growth and corporate profitability. Those things are interest rates, which determine relative value among asset classes and earnings, which determine valuation of equity share price. These two fundamental factors are inherently interrelated. What long-term investors are not concerned with is price movement resulting from news, politics or general hysteria. These things can and do result in sometimes abrupt and severe market moves. They do not in and of themselves impact markets long-term, unless they are effecting interest rates and earnings downstream. It is those underlying changes that we watch for and respond to. For now, interest rates have stabilized and we anxiously await earnings season. We remain cautiously bullish.
Year-to-date net-of-fees performance:
ALPHA INCOME: -1.83%
Performance is presented net of the maximum advisory fees and commissions (2%). Numbers indicated with (+) for positive return and (-) for negative return.
-G. Chadd Mason, CEO
By using this website and or blog, or making a purchase, user agrees as follows:
All written content on http://cabanaportfolio.com website (the “Website”) is for informational purposes only. The material presented is believed to be from reliable sources and no representations are made by CABANA, LLC (d/b/a “Cabana Asset Management”), Cabana Law Group, or Cabana Financial, LLC (collectively, “Cabana”) or its affiliates as to another parties’ informational accuracy or completeness. All information or ideas provided should be discussed in detail with an advisor, accountant or legal counsel prior to implementation. No party, including but not limited to, Cabana and its affiliates, assumes liability for any loss or damage resulting from errors or omissions or reliance on or use of this material.
The views and opinions expressed are those of the authors do not necessarily reflect the official policy or position of Cabana or its affiliates. Any content provided by our bloggers or authors are of their opinion, and are not intended to malign any religion, ethnic group, club, organization, company, individual or anyone or anything.
Information presented is believed to be current. It should not be viewed as personalized investment advice. All expressions of opinion reflect the judgment of the authors on the date of publication and may change in response to market conditions. You should consult with a professional advisor before implementing any strategies discussed. Content should not be viewed as an offer to buy or sell any of the securities mentioned or as legal or tax advice. You should always consult an attorney or tax professional regarding your specific legal or tax situation.
Viewers or recipients of the information herein that do not agree with the term and conditions of use, should not utilize this website or any information contained herein. Decisions based on information contained herein are the sole responsibility of the person viewing the website. In exchange for utilizing the information on this website, the visitor agrees to indemnify and hold Cabana Asset management, its officers, directors, employees, affiliates, agents, licensors and suppliers harmless against any and all claims, losses, liability, costs and expenses (including but not limited to attorneys’ fees) arising from the use of this website, violation of these terms or from any decisions that the viewer makes based on such information.
Cabana Asset Management (“CAM”) is a U.S. Securities and Exchange Commission (SEC) Registered Investment Advisor (RIA) pursuant to the Investment Advisers Act of 1940 with headquarters in Fayetteville, AR. CAM’S internet communications are limited to the dissemination of general information pertaining to its investment advisory and financial planning services. Accordingly, CAM does not, and will not, effect or attempt to effect transactions in securities, or the rendering of personalized investment advice for compensation, over the Internet. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly. CAM may only transact business in those states in which it is registered, or qualifies for an exemption or exclusion from registration requirements. Further written disclosure information contained in SEC form ADV Part II, including registration status, fees, and services, is available upon written request. Investment advice can only be rendered after the execution of Advisory Agreement between you and CAM and the delivery of CAM’s SEC Form ADV, Part II to you.
All performance returns are presented net-of-fees and include the reinvestment of dividends and capital gains. Benchmark comparisons are presented gross-of-fees.
Past performance may not be indicative of future returns. No current or prospective client should assume that the future performance of any specific investment or strategy will be profitable or equal to past performance levels.
All investment strategies have the potential for profit or loss. All strategies have different degrees of risk. There is no guarantee that any specific investment or strategy will be suitable or profitable for a particular client.
Historical performance results for investment indexes and/or categories typically do not show the impact of transaction and/or custodial charges or the deduction of an advisory fee, which may decrease historical performance results. There can be no assurances that a strategy will match or exceed its benchmark.
Some performance returns do not represent actual trading using client assets but were achieved through retroactive application of a model designed with the benefit of hindsight. Model returns have inherent limitations. Specifically, these returns do not represent actual trading and may not reflect the impact of material economic and market factors on the adviser’s decision-making if the adviser had actually managed the client’s money during this time frame.
Different types of investments involve higher and lower levels of risk. There is no guarantee that a specific investment or strategy will be suitable or profitable for an investor’s portfolio. There are no assurances that a portfolio will match or exceed any particular benchmark.
Cabana LLC manages assets on multiple custodial platforms. Performance results may vary based upon differences in associated costs and asset availability within the Cabana Model.