May 2021

April 30, 2021

Allocation Percentages for May 2021
USAA
USIBX

0%

USAAX

4%

USCAX

96%

USIFX

0%

Fidelity
FCBFX

0%

FOCPX

20%

FDVLX

80%

FWWFX

0%

Vanguard
VBLAX

0%

VIGAX

0%

VSGAX

30%

VFSAX

70%

Welcome to May and another solid month for the stock market. This year has been particularly difficult to make sense of the market, our economy, and the right investment strategy. We continue to see an elevated risk acceptance from all corners of the market, as evidenced by the almost complete aversion to bonds. Although the bond funds were positive this month, the average monthly return for these bond funds (mostly corporate based with some government treasuries as well) over the last 12 months has been almost flat (-0.65% - 0.30%). This effectively means there is no confidence in bonds as a low risk asset. I think this hinges mainly on two significant trends. - First, government spending and stimulus packages have infused the market with cash and direct investments. When cash is readily available, taking on debt is not as attractive. - Second, inflation is present, and while there is a dispute over how significant or disruptive it may be, bonds either need to return what the real inflation rate is or investors will not invest in them. I started the year with a prediction that I do not think we will see a year like 2020 in terms of huge returns-we are already seeing a year with huge returns. Warning signals in February and March on the over-valuation of stocks sent me to the bond funds in anticipation of a stock market crash, but that obviously did not occur. We did see a stabilization for about 6 weeks during those 2 months, but no major correction. I'm now not so sure we will see a major correction, especially since the economy is recovering and we are likely to see inflation above expectations. Both of these trends will quite possibly result in more investment in the stock market vice bonds. Keep investing!

MUTUAL FUND QUOTES

USAA
Date USIBX USAAX USCAX USIFX
2024-11-15 9.12 41.23 14.53 27.52
2024-11-14 9.12 42.09 14.75 27.63
Daily Change 0%-2.04%-1.49%-0.4%
Month to Date -0.65%4.35%4.46%-2.1%
Year to Date -0.72%29.09%9.58%5.89%
Fidelity
Date FCBFX FOCPX FDVLX FWWFX
2024-11-15 10.48 21.03 16.34 39.65
2024-11-14 10.49 21.56 16.42 40.11
Daily Change -0.1%-2.46%-0.49%-1.15%
Month to Date -0.66%2.64%3.61%1.69%
Year to Date 0.16%14.98%13.79%27.45%
Vanguard
Date VBLAX VIGAX VSGAX VFSAX
2024-11-15 10.62 204.73 98.58 28.88
2024-11-14 10.65 208.94 100.15 28.98
Daily Change -0.28%-2.01%-1.57%-0.35%
Month to Date -1.58%3.83%5.1%-2.6%
Year to Date -5.57%27.96%14.45%1.69%
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