As important economic news is continually hitting the headlines, its important to think about how these developments are affecting your investments. Let's take a look at how a couple of major indexes and index funds have performed since the beginning of the year to determine if your portfolio has the right balance of risk and return.
Investopedia Broker Guides: Enhance your trading with the tools from today's top online brokers.
|Focus||ETF||Year to Date|
|U.S. Dollar||PowerShares DB US Dollar Index Bullish
|U.S. Equity||SPDRS S&P 500 Index
|Europe, Australia-Asia||iShares MSCI EAFE Index
|Energy||United States Oil
|Precious Metals||iShares Comex Gold Trust
|Fixed Income||iShares Barclays 7-10 Year Treasury (ARCA:IEF)||+2.34%|
The S&P 500 index, as tracked by the SPDRS S&P 500 Index fund, has fluctuated over the year; however, this fund was on a steady uptrend until April before it started to decline in recent months. From the beginning of the year to now, the S&P 500 (as well as the DJIA) has at times seen gains over 10%.
SEE: Index Investing
Pullbacks and Producers
Gold futures prices, followed by the iShares Comex Gold Trust fund, have continued to trade near record highs. The U.S. dollar index, followed by the PowerShares DB US Dollar Index Bullish fund, is down slightly. Investors have sought out gold over US dollars as protectors against the uncertainty in the markets.
Technology is near flat since March as top PowerShares QQQ fund holdings like Apple (Nasdaq:AAPL), Qualcomm (Nasdaq:QCOM) and Google (Nasdaq:GOOG) are all near flat in the same time frame as well.
The point of this index fund exercise is a reminder to investors to constantly focus on maintaining a diversified portfolio of investments. In addition, investors should also adopt an investment process for rebalancing their holdings by selling a percentage of winning investments and reinvesting those earnings in whatever you deem important or back into the other investments in your portfolio lagging others.
SEE: 6 Asset Allocation Strategies That Work
Use the Investopedia Stock Simulator to trade the stocks mentioned in this stock analysis, risk free!
Chart AdvisorThere has been lots of hype around the IPO market lately. We'll take a look at whether now is the time to buy.
Stock AnalysisA summary of what Allstate Insurance sells and whom it sells it to including recent mergers and acquisitions that have helped boost its bottom line.
EconomicsWe share some insights on how the recent terrorist attacks in Paris could impact the economy and markets going forward.
Chart AdvisorCopper prices have been under pressure lately and based on these charts it doesn't seem that it will reverse any time soon.
Options & FuturesInvesting during an economic downturn simply means changing your focus. Discover the benefits of defensive stocks.
Mutual Funds & ETFsLearn about the differences between Vanguard's mutual fund and ETF products, and discover which may be more appropriate for investors.
Mutual Funds & ETFsLearn about the difference between using mutual funds versus ETFs for retirement, including which investment strategies and goals are best served by each.
Mutual Funds & ETFsLearn about reinvesting ETF dividends, including the benefits and drawbacks of dividend reinvestment plans (DRIPs) and manual reinvestment.
Investing BasicsHeld onto a stock for too long? Selling at a loss is never ideal, but it is possible to minimize the damage. Here's how.
Mutual Funds & ETFsDiscover the three Vanguard funds tracking the S&P 500 Index, and learn about the characteristics and historical statistics of these funds.
Mutual funds, when compared to other types of pooled investments such as hedge funds, have very strict regulations. In fact, ... Read Full Answer >>
Exchange-traded funds (ETFs) can generate capital gains that are transferred to shareholders, typically once a year, triggering ... Read Full Answer >>
A hedge fund is a type of investment vehicle and business structure that aggregates capital from multiple investors and invests ... Read Full Answer >>
While some Vanguard exchange-traded funds (ETFs) are available commission-free from third-party brokers, a large portion ... Read Full Answer >>
Vanguard completely waives any U.S. dollar minimum amounts to buy its exchange-traded funds (ETFs), and the minimum ETF investment ... Read Full Answer >>
Mutual fund expense ratios cannot be negative. An expense ratio is the sum total of all fees charged by an asset management ... Read Full Answer >>