Market Commentary

January 2018 Investment Strategy

2017 will go down as one of the more unique years in stock market history. The year produced a very attractive 19.4% gain in the S&P 500 Index, while enjoying unbelievably calm price movements. In a sense, 2017 was a Goldilocks market where everything went according to plan. While stock prices would suggest this past year lacked excitement, 2017 was marked by growing geopolitical tensions, a Federal Reserve finally stepping away from crisis-era stimulus policy, and an unpredictable U.S. administration. More recently, we have also watched digital currencies, such as Bitcoin, surge higher in bubble-like fashion. Despite these events and others, the maximum drawdown in the S&P 500 Index was only 2.8% this year (3/1 - 4/13). We cannot explain the tranquility in the stock and bond markets, we only know it would be foolish to expect these conditions to continue.