Not A Bad Call
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View from the Observation Deck

  1. The feature article in our April 2008 Quarterly Market Overview was the following: "Time for U.S. investors to bring some of their dollars home."
  2. We published this newsletter around 11 months before the bear market in equities ended on March 9, 2009.
  3. One of the things we noticed heading into 2008 was that investors had funneled a net $490 billion into "World Equity" funds from 2003-2007, according to Investment Company Institute (ICI) data.
  4. Over that same five-year period, investors only committed a net $173 billion (ICI) to U.S. equity funds. They had recognized that returns were better overseas. 
  5. From 12/31/02-12/31/07, the cumulative total return for the S&P 500 was 82.8%, compared to 178.2% (USD) for the MSCI World (ex U.S.) Index and 373.3% (USD) for the MSCI Emerging Markets Index.
  6. The chart shows that the S&P 500 has outperformed year-to-date (thru 8/31), over the past 12 months, three years, and since we published our forecast touting U.S. equities (3/31/08).
  7. We believe that while investors should always consider being properly diversified, there are occasions where returns can be potentially boosted by overweighting one or more asset classes.  
  8. For the record, we still favor the prospects for U.S. equities for the remainder of this year and in 2013.
Posted on Tuesday, September 18, 2012 @ 4:16 PM

These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.