Ocean Park Capital Management

2503 Main Street

Santa Monica, CA 90405

Main: 310.392.7300

Daily Performance Line:  310.281.8577

April 2019
Market Update
(all values as of 02.29.2024)

Stock Indices:

Dow Jones 38,996
S&P 500 5,096
Nasdaq 16,091

Bond Sector Yields:

2 Yr Treasury 4.64%
10 Yr Treasury 4.25%
10 Yr Municipal 2.53%
High Yield 7.63%

YTD Market Returns:

Dow Jones 3.47%
S&P 500 6.84%
Nasdaq 7.20%
MSCI-EAFE 2.23%
MSCI-Europe 1.23%
MSCI-Pacific 3.98%
MSCI-Emg Mkt -0.27%
 
US Agg Bond -1.68%
US Corp Bond -1.67%
US Gov’t Bond -1.59%

Commodity Prices:

Gold 2,051
Silver 22.87
Oil (WTI) 78.25

Currencies:

Dollar / Euro 1.08
Dollar / Pound 1.26
Yen / Dollar 150.63
Canadian /Dollar 0.73
 

Fund Overview

Equities generated low to mid-single digit gains in April.  The Ocean Park funds also rose, but trailed the major indices.  Our profits in technology and consumer stocks were offset somewhat by weakness in health care, which was the worst performing sector for the month.  Nonetheless, we continued to outperform the HFRI Equity Hedge Index, which rose 1.63% for the month and is up 9.45% for the year to date.

During April, we added to positions in the consumer discretionary and service sector and the producer durables sector, and reduced positions in the health care sector.  We ended the month at about 90% net long, up from about 80% in March.

A schedule showing the performance of the Investors Fund is included below, along with our Asset Allocation Chart. Daily updates on our activity are available on our Results Line, at
310-281-8577, and current information is also maintained on our website at www.oceanparkcapital.com. To gain access to the site enter password opcap.

 

 

 

*These results are pro forma. Actual results for most investors will vary. See additional disclosures on page 4. Past performance does not guarantee future results.

 
Equity Overview - April 2019

Equity Overview

Market gains in April were broad-based.  Investors favored growth and value stocks about equally.  And large, mid, and small cap stocks all performed well.  Volatility remained subdued, with the S&P 500 index moving more than 1% on only one trading day (on a move to the upside).

46% of S&P 500 companies reported 1st quarter earnings in April, and results were less impressive than in recent quarters.   Although 77% of companies beat consensus earnings estimates (slightly above the 1-year average of 76%), only 59% beat consensus revenue estimates (significantly lower than the 67% 1-year average).  And the blended earnings growth rate, which was in the positive 20% range in previous quarters, turned negative at -2.3%. (The blended growth rate combines reported year-over-year growth with analysts’ estimates of upcoming results.)

 

 

 
Macro Overview - April 2019

Macro Overview

Economic data reported in April was mixed.  Manufacturing showed expansion but at a slower pace than in previous months, and housing was weak.  However, employment was strong, overall unemployment remained at historically benign levels, and initial claims for unemployment dropped to 49-year lows.  Perhaps most surprising, the Commerce Department’s initial estimate of 1st quarter GDP growth was 3.2%, significantly higher than almost all expectations.

Fed minutes released in April indicate that interest rates will remain steady for the rest of 2019.  Similarly, the European Central Bank signaled that it does not plan to raise rates in 2019.

Trade talks with China continued to dominate the headlines, but details about their exact status were unclear.  Unlike previous administrations, the primary source for developments appears to be the president’s Twitter account—which has not proven to be an optimal substitute for traditional journalism.

 

 

 
Additional Disclosures - April 2019

Additional Disclosures

Performance data for OPI reflect the reinvestment of dividends and other earnings on the fund’s assets.  Performance data for the major indices reflect only changes in the value of those indices, and would be higher if dividends were included. However, the index data do not reflect fees that would be paid to index fund managers and transaction costs that would be incurred when their component stocks are bought or sold, while OPI’s data do reflect quarterly fees and expenses incurred by the fund.  The information provided is believed to be reliable, but its accuracy or completeness is not warranted. This material is not intended as an offer or solicitation for the purchase or sale of any stock, bond, mutual fund, or any other financial instrument. The views and strategies discussed herein may not be appropriate and/or suitable for all investors. This material is meant solely for informational purposes, and is not intended to suffice as any type of accounting, legal, tax, or estate planning advice. Any and all forecasts mentioned are for illustrative purposes only and should not be interpreted as investment recommendations.