First Quarter 2015 Review | Fee-Only Financial Planners Long Island

First Quarter 2015 Review

The investment markets in the first quarter of 2015 were up across most asset classes with the exception of money market funds which were flat. Despite a strengthening U.S. Dollar, international stocks had the best performance in the first quarter. Investors are anticipating the improved competitive position of foreign companies versus their U.S. counterparts. In addition, there were some minor signs of European Union economies strengthening.

Domestic large-cap stocks were up around 1% for the first quarter. During this time, investors weighed the pros and cons of having a much stronger U.S. dollar than one year-ago, and what the change would do to profits and the competitiveness of U.S. franchises over the long-term. Meanwhile, smaller-cap companies shined as they are less affected by global currency movements, the U.S. economy continued to strengthen, and unemployment declined.

Despite the expectation of rising interest rates, the fixed income sector continues to produce positive returns. Taxable bonds did slightly better than tax-free bonds, which were both up between 1-2%. All indications suggest that the Federal Reserve will wait until later this year – or perhaps even later – to raise interest rates.

Major Market Indexes 1


Outlook and Strategy

We continue to favor larger-cap domestic equities and a broad array of fixed income securities with varying maturities. We believe there is still value in dividend growing companies, so we have a slight value-bias to the equities in our portfolios. We will continue to avoid, where possible, direct exposure to international securities, because the currency headwind (strong U.S. Dollar) has a greater probability of reducing foreign returns going forward.

We are still keeping cash and money-market fund exposure to a minimum because they provide little to no protection against inflation, which is running in around three percent annualized. There are better places to achieve lower-risk returns that will keep pace with inflation.

We are also continuing to implement our strategy for reducing underlying fund fees, improving tax efficiencies, and decreasing cash equivalents in all of our portfolios. As previously discussed this will take some time to completely implement. For taxable accounts, there will be tax consequences associated with this strategy, and it needs to be carefully managed with the individual account holders and their accountants.

If you would like to speak with a Senior Wealth Advisor at R.W. Rogé & Company, Inc., please contact us at 631.218.0077 or at It would be our privilege to serve you and your family’s needs.


1 Steele Mutual Fund Expert

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