Model Large Cap Portfolio Return of -2.8% for the Quarter Ended 09/30/19.

The large cap model portfolio ended the 3rd quarter of 2019 with a closing valuation of $280.83 USD per share. At the end of the 2nd quarter 2019, the portfolio was valued at $288.89 USD. The quarterly loss was 2.8%.

By way of comparison, the DJIA produced a positive return of 1.2% for the 3rd quarter of 2019. The S&P 500 produced a return of 1.2% for the 3rd quarter 2019 and the NASDAQ essentially broke even on the quarter (inconsequential loss of less than 1/100th of 1%).

The absolute and relative underperformance of the large cap model portfolio for the third quarter would normally give pause to consider whether the investment philosophy and portfolio composition continues to be appropriate. However, based upon the YTD return of 30.4% (the account ended 2018 with a value of $215.28 per share), it seemed almost inevitable that such a deviation from the mean in the first half of 2019 would swing back towards a more traditional level of performance.

For the first nine months of 2019, the NASDAQ, the DJIA and the S&P 500 have produced positive returns of 20.6%, 15.4% and 18.7% respectively.

Outside of North America, many countries have experienced GDP deceleration to the point that should growth not resume, a reasonable portion of the globe will meet the technical definition of economic recession (two quarters or more of negative GDP growth). The United States represents the major outlier on the planet; reporting solid GDP numbers, America seems to be a bright star. Unfortunately for the investment community at large, no single country, even one as significant as the USA, is large enough to prop up a moribund global economy.