It may feel like the market is rising to extreme levels, but index valuations are reasonable, and highly attractive stock-specific opportunities persist. This is our monthly performance update whereby part 1 shares our overview of current market conditions, and part 2 reviews the continuing powerful long-term gains of our three investment strategies (they were all up again over the last month), as well as a performance review of every individual holding (we currently have 65 individual positions across three separate portfolios), and more details on some specific highly-attractive high-income opportunities.
For starters here is a look at how the market performed in over the last month. And to make a long-story short, the S&P gained 2.17% (total return, including dividends), healthcare stocks finally got a little LOVE, and energy stocks are still HATED!!
Regarding healthcare, we’ve recently made some good calls (so far) on AbbVIe (ABBV) and Pfizer (PFE) (members have access to those reports, which are both about 1-month old since we shared the details of those opportunities).
Regarding Energy, we also shared a bunch of recent opportunities in that sector, but energy stocks (most of them) continue to be HATED, and lower oil prices are a big driver of that (see chart below).
Also worth mentioning, one of our favorite sectors this year (thanks to the attractive yields) has been REITs, and those real estate stocks have continued to be a dominant sector this year (as you can see in our earlier sector performance table).
Interest rate expectations moving lower has helped many REITs this year, but how much longer can that persist? In fact, we diversify by investing in attractive opportunities across sectors (not just REITs) because it helps us reduce risks and keep returns and income high. Here is a look at changing interest rate expectation this year.
Yet, despite strong performance for REITs this year, as well as strong performance for the overall market in general (as measured by the S&P 500), market valuation remains reasonable. Here is a look at forward Price-Earnings ratios for the S&P 500.
Worth mentioning, a big part of the strong returns for the market this year has been multiple expansion. If you recall, the 4th quarter of last year was terrible for the market, and a big part of the market’s gains this year have just been the rebound in multiples. For perspective, here is a chart demonstrating multiple expansion for both the US and abroad.
And in case you are wondering, here is the recent performance of non-US equity markets, as well as bonds and preferred stocks (which have also been surprisingly resilient).
Part 2: Blue Harbinger Holdings and Performance:
Here is a look at the strong continuing performance and income of our three investment strategies.
As a reminder, “Income Equity” and “Income Via Growth” each hold 25 unique stocks, respectively, and the Alternative Fixed Income portfolio has 15 positions (consisting of attractive fixed income Closed-End Funds and individual highly attractive preferred stocks—preferred stocks pay high income and generally behave more like bonds than common stocks).
And here is a look at the growing track records of the strategies, by month.
Next here is a look at the weightings and performance of every single position (all 65 of them) across multiple time periods (including the last month), and separated by portfolio strategy (followed by a review, more details and attractive opportunities).
The remainder of this report is reserved for members only. Please login (or consider a membership) for access.
Note: For those of you just passing by as free readers, here are a few final thoughts. First, despite the market’s strong gains this year, valuations remain reasonable. And despite reasonable valuations, plenty of attractive security-specific opportunities persist (as you can read in our many free reports here). It’s important to be opportunistic as pockets of the market get emotional and irrational, but don’t go overboard, and don’t ever lose sight of your personal goals as an investor. Disciplined, goal-focused, long-term investing has proven to be a winning strategy over and over again throughout history.