September 2024 Monthly Index Returns

Hi Everyone, Happy October!

In stocks (equities):

All stock indexes shown were positive for September. In fact, all are positive for the last 3 months, YTD, and last 1 yr. For the last 3 yrs, only small cap growth (-0.4%) and non-US REITs (-3.4%) had negative returns.
During September, emerging markets (6.7%) led the way and their YTD (16.9%) and 1 yr returns (26.1%) are now higher vs. their developed counterparts.
Following emerging markets in September were non-US REITs (3.6%), international developed small cap value (2.9%), and global REITs (2.8%).
We know many clients are focused on large cap growth and tech, so it's important to note that the R1000G actually had the lowest Q3 return of any stock index we track (3.2%). In fact, the next closest stock index return was the S&P 500, which returned 5.9% over Q3.

In bonds (fixed income):

All the bond indexes we track were positive over the last month, 3 months, YTD, and 1 yr periods.
10+ yr corporates (2.7%) and Treasuries (2.0%) led the way in September as longer term yields fell during the month.
While the 10 yr Treasury yield fell over the month from 3.91% to 3.81%, the yield actually increased from the day before the Fed cut rates (Sept 17) through the end of month (3.65% to 3.81%). While this may seem counterintuitive, the reasoning is that the Fed's aggressive move of cutting rates by 50 bps decreased the odds of a recession in the eyes of many investors, so the prices of Treasury bonds fell (and yields move inversely to prices). This also highlights something we have noted many times before; the Fed controls the very short term part of the curve, but market expectations control the rest.
Non-US bonds (hedged USD) gained 1.0% during September and 4.2% YTD, relatively in line with the US Agg's returns of 1.3% and 4.4% over the same time periods.

As always, please let us know if you have any questions by emailing support@xyinvestmentsolutions.com.

As an additional note, please keep in mind that these reflect historical performance of the current models, not necessarily how accounts were invested in the past.