November was another positive month for U.S. equity markets amid a growing optimism that U.S. and China trade talks will be able to come to a “Phase 1” —the significant first step toward stable, continuing resolution of trade disputes— agreement. As market movement continues to be dominated by these negotiations any negative news could add ready volatility, but as positive headlines came out this month U.S. markets consistently made new highs in November.
Currently, markets are at all-time highs and appear poised to climb higher as both strong data and underlying market fundamentals seem supportive of further growth. U.S. markets returned their best month since June as the S&P 500 Index ended the month up 3.63%, the NASDAQ Composite Index increased 4.65%, and the Dow Jones Industrial Average Index gained 4.11%. International markets remained mixed, however, and the MSCI Emerging Net Total Return Index returned -0.14% and the MSCI EAFE Net Total Return Index gained 1.13%.
The Stadion Tactical Defensive Fund began the month of November invested in 75% Equity and 25% Fixed Income. However, the very next day the Fund was fully invested in 100% Equities and there were no more trades in the month of November. November ended with the Core Portfolio and the Satellite Portfolio both fully invested. Given the strength of the underlying indicators for the longer-term measure, it could be some time before we see any sort of reduction in the equity allocation for that portion of the Fund. As always, the Satellite portfolio can react quickly to market changes so we could see a reduction in equity exposure given an increase in volatility.
The Stadion Tactical Defensive Fund is a conservative equity fund seeking to participate in expanding market cycles and retains the ability to become 100% defensive if conditions deteriorate. Over a full market cycle, the Stadion Tactical Defensive Fund tends to have a conservative profile that combines two elements of trend following: a focus on longer-term cyclical trends (the core portfolio) and the balance of risk-mitigation and returns-seeking among shorter to intermediate trends (the satellite portfolio).
The goal of these collaborative strategies is capital appreciation as measured across full market cycles.
For November, the Tactical Defensive Fund’s I-share returned 2.49% versus its benchmark of the Morningstar Moderate Target Risk Index of 1.38%.
To view the most recent performance for the Stadion Tactical Defensive Fund, click here.
The NASDAQ Composite is a stock market index of the common stocks and similar securities listed on the NASDAQ stock market and it is highly followed in the U.S. as an indicator of the performance of stocks of technology companies and growth companies.
The S&P 500 Index is the Standard & Poor’s Composite Index of 500 stocks and is a widely recognized, unmanaged index of common stock prices.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange.
The MSCI Emerging Markets Index consists of 23 economies including Brazil, Chile, China, Colombia, Czech Republic, Egypt, Greece, Hungary, India, Indonesia, Korea, Malaysia, Mexico, Peru, Philippines, Poland, Qatar, Russia, South Africa, Taiwan, Thailand, Turkey and the United Arab Emirates. The MSCI is a float-adjusted market capitalization index. As a total return index, it tracks the capital gains of a group of stocks over time and assumes reinvestment of any cash distributions.
The MSCI EAFE Net Total Index (Europe, Australasia, Far East) is an unmanaged free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the US & Canada. As a total return index it tracks the capital gains of a group of stocks over time and assumes reinvestment of any cash distributions.
The Morningstar Target Risk Index family is designed to meet the needs of investors who would like to maintain a target level of equity exposure through a portfolio diversified across equities, bonds and inflation-hedged instruments. The Morningstar Moderate Target Risk Index seeks approximately 60% global equity exposure.
One cannot invest directly in an index.
The Report’s commentary, analysis, opinions, advice, and recommendations represent the personal and subjective view of the author and are subject to change at any time without notice.
There are additional costs and potential risks associated with investing in domestic and international Exchange Traded Funds (ETFs). Investment in the Fund is subjective to investment risks, including, without limitation, market risk, management style risk, risks related to “fund of funds” structure sector risk, fixed income risk, tracking risk, risks related to ETF net asset value and market price, foreign securities risk, risks related to portfolio turnover and small capitalization companies’ risk. Since each Stadion fund is a “fund of funds”, an investor will indirectly bear fees and expenses charged by the underlying ETFs and investment companies in which a Stadion Fund invests in addition to a Stadion Fund’s direct fees and expenses. More information about these risks and other risks can be found in the Fund’s prospectus.
There are risks associated with the potential investment of the Fund’s assets in fixed income investments which include credit risk, interest rate risk, and maturity risk among others. These risks could affect the value of investments of the Fund, possibly causing the Fund’s share price and total return to be reduced and fluctuate more than other types of investments. Additional information about fixed income risks can be found in the Fund’s statement of additional information (“SAI”). Investment Objective: Seek long-term capital appreciation.
The Fund’s foreign investments generally carry more risks than funds that invest strictly in U.S. Assets including currency risk, geographic risk, and emerging market risk. Risks can also result from varying stages of economic and political development, differing regulatory environments’ trading days and accounting standards, and higher transaction costs of non-U.S. markets.
An investor should consider the investment objectives, risks, and charges and expenses of the Stadion Funds carefully before investing. The prospectus contains this and other information about the Funds. A copy of the prospectus is available by calling Stadion Funds directly at (866) 383-7636 or Stadion Money Management, LLC., the investment advisor, at (800) 222-7636. The prospectus should be read carefully before investing.
The Stadion Funds are distributed by ALPS Distributors, Inc. An investment in the Funds involves risk, including loss of principal.