Year in Review: 2017

With 2017 now in the rearview mirror and our sights set on what lies ahead in 2018 and beyond, I wanted to take some time to recap the markets in 2017.

The year was historic for a number of reasons. Markets around the world rallied as years of lethargic, uneven global growth gave way to a period of synchronized global expansion, with every country in the G20 achieving positive economic growth last year. This pickup in activity drove corporate profits higher, and investors reacted by flooding money into riskier parts of the market. In the US, domestic stocks returned 21.8%, only to be outdone by their overseas counterparts - developed international and emerging markets rallied 25.7% and 37.6%, respectively. While those returns are certainly above average, it is not the return alone that made the year so unique. Instead it was the nature in which those returns were achieved, namely the incredible lack of any downside volatility. The S&P 500 Index registered a positive return every single month in 2017. This was the first time that this has happened in the history of the index, EVER. That is pretty incredible, especially considering we are in the ninth year of the current bull market.

Fixed income markets also enjoyed a decent year, despite the Fed continuing their path of monetary policy normalization. The aggregate bond market returned 3.5%, with long-term and high-yield bonds faring even better.

2017 was undoubtedly a tremendous year for global investors, particularly for investors in higher-risk areas. As we all know, periods like this always come to an end at some point and your team at Allegiant is diligently analyzing incoming pieces of economic data to insulate our portfolios should the economic tide turn.

Click here to see a further breakdown of 2017 returns.