Hi, I’m Mike Walther delivering the Oak Wealth Advisor’s 2024 first quarter market update. As you all know, the first quarter was still a time of strife all throughout the world, but the U.S. investment markets did pretty well. Let’s take a look at the numbers together.

For the first quarter of 2024, U.S. large cap stocks as proxied by the S&P 500 delivered over 10% in just the first three months of the year. On the opposite end of the investment return spectrum, was fixed income or bonds. And on that side of things, the markets were slightly negative. As you can see at the bottom of the page here, the taxable bonds were down about 0.8% and municipal bonds were down a little bit less at 0.4%. That was due in large part to the fact that despite the markets expecting interest rates to come down during the first part of 2024 and inflation to be lower than it was last year, the opposite happened. Inflation stayed higher. The Federal Reserve chose not to cut rates and actually extended out how far they expect it to be before they begin to lower rates. And as a result, bonds suffer. We think this is probably a short-term phenomenon. As you can see, the six-month returns for bonds are better, up six and seven and a half percent for those two asset classes. And we expect that once rates do in fact start to come down, we’ll get more robust returns from our fixed income investments. On the rest of the equity markets, U.S. small cap stocks, and developed international stocks both did really well for the quarter, up over 5%. Even emerging markets delivered 2.4% of positive returns. And over a three-month period, those are all really great results. And if we look out further, all the equity classes have had a really nice run over the last 12 months.

Now, at Oak Wealth Advisors, we also have a third leg to our investment portfolios, in addition to the stocks and the bonds. And that third component is what we call complementary strategies. and that’s primarily composed of what we call managed risk strategies. And the managed risk strategies are in portfolios primarily to reduce risk and add diversification. And what happened during the first quarter was really surprising in a positive way. The different funds we typically use with clients are illustrated on the screen. And as you can see, all five of our managed risk strategy funds, and they’re not ours again, they’re the ones we use in client portfolios, were all positive by between 5.5% and 7%. Those are the kinds of returns we’d expect these funds to deliver over a 12-month period, and they did it all in the first quarter of 2024. Looking back another nine months to make it a one-year period, you can see that all of these funds had a one-year track record, Hilo does not, but the other four do, all delivered between 13.5% and 21%. So it’s wonderful we get these added performance bonuses. from investments or really in the portfolio to reduce the overall risk. So as you can see, the benefit of having managed risk strategies can be both risk reduction and at a time like the first quarter of 2024, also an improvement to investment performance.

So I encourage you to reach out to your advisory team, talk to them about your portfolio, ask any questions you may have, and we look forward to getting your questions answered for you. As you know, we’re here for you. We want to answer your questions. We want to make sure you understand. your investments and make sure your investment strategy is properly aligned with your goals and your needs. We look forward to answering those questions and we’ll have another update for you in three months. Have a great spring!