July 2012 Market Recap

Monthly Recap

Global markets got a boost following the July 26 comments made by the European Central Bank’s president Mario Draghi. In his remarks, Mr. Draghi stated that the ECB would “do whatever it takes” to ensure that the Euro remained intact. Investors took this as a sign that the ECB would take immediate simulative action in an effort to shore up the European economies,   bidding stock prices higher.

These comments boosted investor confidence, resulting in a modest 1.1% gain in the MSCI EAFE Index in U.S. dollar terms while the S&P 500 gained 1.4%. Unfortunately for Canadian investors these gains were muted, as the Canadian dollar rose against other currencies. The dollar gained 1.76% against the greenback, rising from $0.9813 to end the month at $0.9986. Once the currency affect was taken into account, gains were much reduced, with the S&P 500 rising a more modest 0.03% and the MSCI EAFE losing 0.61% in the month.

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Monthly Fund Ranking Report

Each month, we analyze more than 1200 mutual funds, pooled funds, and hedge funds putting them through our proprietary quantitative valuation model. We then prepare our Monthly Fund Ranking Report which rates and ranks each of the funds in our universe.

You can download our July 31, 2012 Investment Fund Ranking Report here.

Monthly Socially Responsible Investing Report 

With environmental and human rights concerns becoming more important to people, interest in the Socially Responsible Investing segment has never been stronger. In an effort to help keep investors and advisors informed on the SRI funds available, we have created our monthly Socially Responsible Investing Fund Report, which will be published on a monthly basis.

You can download the July 31, 2012 Socially Responsible Investing Report here.

Monthly WRAP Funds Report 

Fund of Fund or WRAP funds have consistently led the mutual funds sales stats in the past few years. Investor and advisor interest in the products are at an all time high, given the unprecedented levels of market volatility and uncertainty that is prevalent in the markets today. To help you zero in on the best WRAP funds available, we have created our new Monthly WRAP Funds Report that will be published on a monthly basis. If there is a WRAP fund that you would like to see added to this report, please contact us and we will add it for our next edition.

You can download the July 31, 2012 WRAP Fund Report here.

Model Portfolio Review 

The portfolios struggled during the month, underperforming their respective benchmarks. The key reason for this underperformance was the poor relative showing from the equity funds in the portfolios.

You can download our detailed Portfolio Review here.

My Mortgage Dillema 

My wife and I rented a great place in the Beach area of Toronto, a stone’s throw from the boardwalk and some of the city’s best pubs and coffee shops. We lived there for five years and really loved it, but when we received the news that we are expecting our first child in December, we realized the need for something bigger very soon.

We would have loved to have bought in the Beach or anywhere else in the downtown for that matter, but as first time home buyers, we just couldn’t afford it. So we settled on a three bedroom side split in a desirable area of Whitby that we moved into last week. It has a great yard, a wonderful neighbourhood feel and is the type of place you would want to raise a family. Another reason that we liked it is that it is a ten minute drive from my wife’s office and since I work at home it also works for me. The house was priced in the mid $300,000s, leaving us with a mortgage of about $300,000 and the complex questions of deciding how long a term to take, what rate and the trade offs of each choice.

Read the entire article here