In January 2014, the S&P 500 lost 3.5% and our average customer portfolio lost 2.4%, a disappointing result in absolute terms, but our result was more than 1% better than the S&P 500 helped by our exposure to bonds.
Stocks weak across the board, emerging markets declined significantly
Stocks funds generally declined, with small cap declining slightly less than average and value declining slightly more. These two trends were generally offsetting. Outside the US, non-US developed markets did slightly worse than the US, but small caps performed slightly better. Again these trends were broadly offsetting. Emerging markets had a particularly weak month declining 8-9% depending on the fund.
Real estate mixed, bonds a source of strength
Domestic REITs (real estate funds) helped performance growing over 3% but international real estate declined over 4%. Our bond exposure performed strongly rising across the board, with domestic bonds leading with over 1.5%.
Overall, January was a disappointing month for the stock market with broad declines, but exposure to bonds enabled our outperformance.