Performance Year-To-Date {Total Return}

We continue today our year-to-date performance review covering different parts of the market based on our own portfolio programs and overall asset allocation process.  Today we're taking a look at various ETFs we have in our total return strategies.  These results are through May 21, 2018.  Also, as always, you can click on the chart  if you want to make it  larger.  These performance chart are from Stockcharts.com, although the ETF selection is my own.  Also I believe the performance data shown above does not include dividends.  If I am correct then the total returns on these indices is actually better than what is shown above.

This strategy has on a price basis slightly underperformed the market on a relative basis.  However, when you take into account their dividends then their performance is more comparable to the overall market.  This should not be surprising as dividend and interest related investments often underperform in the face of rising interest rates.  Also many of these ETFs had done better than the overall market coming into last year so a period of outperformance by more broad based and growth oriented investments was at some point going to occur.  

The one exception to this would be REIT based ETFs.  REITs stand for Real Estate Investment Trusts.  No is not a time to go into REITs in particular but just understand that higher interest rates hurt REITs because it raises their borrowing costs.  To compensate of course REITS have much higher dividend yields so it can pay to wait.  Still the longer term underperformance over the last two years is pretty stark.  

Back Monday.

*Long in client and personal accounts in some manner the indices listed above with the exception of the fixed income ETFs.  These are shown for illustrative purposes only.  Positions can change at any time without notice on this blog or via any other form of electronic communication.