JWA market return Benchmark^™ Results

 

When someone mentions the “stock market” most people immediately think of the S&P 500 or maybe the Dow Jones Industrial average.  These familiar indexes have become synonymous with “the market” even though combined they only represent approximately 12% of all U.S. stocks.  And that’s not even considering international stocks, which make up 60% of the world capital markets.

 

Indexes made sense fifty years ago because they were easy to calculate and track.  Although they were only a small sample of stocks, they gave us a general indication of where the market was heading.  Over the last five decades, however, investing has been revolutionized by the advent of computers and Modern Portfolio Theory.  We now know that proper investing requires seven to fifteen different asset classes at least.  So why do Wall Street and the media continually insist on referencing only one or two? 

 

 Amazingly, Wall Street has yet to provide investors with a true benchmark representing the whole market.  The industry can constantly come up with new products to sell consumers, but they haven’t devised a simple benchmark for fairly and accurately measuring a portfolio’s performance.  We believe it’s time to change that!  You need some way to measure your portfolio return against the extended capital market system.  You need a market return benchmark. 

 

 

Description of Asset Classes used in Market Return Benchmark^™

 

Index	Asset Class
CRSP 1-2 Index	Large Cap
CRSP 6-10 Index	Small Cap
Wilshire REIT Index	Real Estate Investment Trusts
MSCI EAFE	International
MSCI EAFE Small Company	International Small Cap
MSCI Emerging Markets Index	Emerging Markets

CRSP – Capital Research in Security Prices, University of Chicago

MSCI – Morgan Stanley Capital International

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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