Ocean Park Capital Management

2503 Main Street

Santa Monica, CA 90405

Main: 310.392.7300

Daily Performance Line:  310.281.8577

September 2018
Market Update
(all values as of 07.31.2020)

Stock Indices:

Dow Jones 26,428
S&P 500 3,271
Nasdaq 10,745

Bond Sector Yields:

2 Yr Treasury 0.11%
10 Yr Treasury 0.55%
10 Yr Municipal 0.64%
High Yield 5.44%

YTD Market Returns:

Dow Jones -7.39%
S&P 500 1.25%
Nasdaq 19.76%
MSCI-EAFE -10.64%
MSCI-Europe -10.86%
MSCI-Pacific -10.53%
MSCI-Emg Mkt -3.21%
 
US Agg Bond 7.72%
US Corp Bond 8.44%
US Gov’t Bond 9.35%

Commodity Prices:

Gold 1,992
Silver 24.54
Oil (WTI) 40.43

Currencies:

Dollar / Euro 1.17
Dollar / Pound 1.30
Yen / Dollar 105.01
Dollar / Canadian 0.74

Fund Overview

Equities were mixed in September, with the S&P 500 up fractionally and the NASDAQ and the Ocean Park funds down fractionally.  Our health care stocks were up, but our technology stocks lost ground.  Nonetheless, for the year to date we remain well ahead of most of the major indices as well as the Equity Hedge (Total) Index which is up 1.85%.

During September, we added to positions in the consumer discretionary and service, health care, and producer durables sectors, and reduced positions in the materials and processing sector.  We ended the month at about 91% net long, up from about 85% in August.

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 - September 2018

Equity Overview

Stocks had a relatively quiet month in September as volatility subsided.  The S&P 500 moved in a narrow range of about 2% from its low to its high.  Large cap stocks showed gains while small and mid-cap stocks were down.  Leading sectors included health care and energy, while financials and utilities lagged.

Notwithstanding substantial gains in stock prices this year, valuations remain reasonable as earnings have also risen.  The S&P 500 finished the month with a forward price-earnings ratio of 16.8x, only modestly higher than its 25-year average of 16.1x.

 

 

 
Macro Overview - September 2018

Macro Overview

Continuing the theme of the last several months, trade negotiations and tariffs dominated the economic news.  Escalating the trade war in late September, the administration imposed tariffs of 10% on $200-billion of Chinese imports, rising to 25% by year end if no agreement is reached.

Economic data reported in September was generally positive.  Manufacturing was strong, along with wages and retail sales.  Consumer sentiment as measured by the University of Michigan reached its third highest level since 2004.

Signaling increased confidence in the U.S. economy, the Fed raised its expectations for 2018 GDP growth from 2.8% to 3.1% and hiked interest rates for the third time this year.  It raised the federal funds rate by 0.25% to a range of 2.00-2.25% and implied that it will raise rates again at its meeting in December.

 

 

 

 

 
Additional Disclosures - September 2018

 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.