Stocks experienced a modest sell-off as the September effect lived up to its name this year (September is the only month with a negative average return over the past 100 years).
The S&P 500 dropped 4.76%, snapping a streak of seven consecutive monthly gains for the Index. While the losses were wide spread, value-oriented companies held up better than growth companies, and small cap stocks fared better than large cap stocks.
International stocks were slightly less negative than their US counterparts, though not for lack of gloomy headlines overseas. Despite a better month of September, international stocks still trail US stocks for the year.
Bond markets were also under pressure as the 10-year Treasury yield rose from 1.30% to 1.52%. Broadly higher interest rates have been a headwind to bonds all year, as the asset class remains in the red.
Believe it or not, we are already heading into the fourth and final quarter of 2021. Investors are hoping September was just a healthy break in the longer-term upward trend.
The curse of having “ever” in your name continues in 2021 (remember when the cargo ship Ever Given blocked the Suez Canal back in March).
Evergrande, a large Chinese real estate development group, holds more than 1,300 projects across 280 cities.
However, the property giant’s borrowing has ballooned as it looked to continue financing pursuits outside its core business model.
This has resulted in Evergrande racking up over $300 billion worth of debt.
Now, the company is warning investors of cash flow issues, meaning it could default on this debt.
While headlines are pointing to Evergrande as the next Lehman, experts say these comparisons are overblown.
A billionaire, a physician assistant, a college professor, and a data engineer go to space…
No, this isn’t the start to a cheesy joke, it actually happened.
On September 15, SpaceX launched the first ever all-civilian team into Earth’s orbit. After circling the planet 45 times over the course of three days, the crew successfully splashed down in the Atlantic Ocean.
The mission, dubbed Inspiration4, was to study the human body in space and to raise $200 million for children with cancer and other life-threatening diseases through St. Jude Children’s Research Hospital.
Onboard computer systems were in control of the capsule during its journey.
Space enthusiasts are beaming as this marks a new milestone for the space tourism industry.
Broad Market Returns
| Index | 1 Month | 3 Month | YTD | 1 Year |
| S&P 500 (VOO) | -4.66% | 0.55% | 15.93% | 30.04% |
| NASDAQ (QQQ) | -5.68% | 1.11% | 14.50% | 29.53% |
| Large Cap Growth (VUG) | -5.32% | 1.28% | 14.98% | 28.22% |
| Large Cap Value (VTV) | -3.94% | -0.94% | 15.72% | 32.60% |
| Small Cap Growth (VBK) | -3.88% | -3.27% | 4.91% | 30.89% |
| Small Cap Value (VBR) | -2.55% | -2.16% | 20.41% | 55.74% |
| Developed International (VEA) | -3.39% | -1.62% | 8.73% | 26.62% |
| Emerging Markets (VWO) | -3.36% | -7.06% | 1.39% | 18.21% |
| REITs (VNQ) | -5.68% | 0.61% | 22.15% | 33.50% |
| Aggregate Bonds (BND) | -1.01% | -0.05% | -1.82% | -1.03% |
| Corporate Bonds (VCIT) | -1.04% | -0.15% | -1.38% | 1.00% |
| High Yield Bonds (JNK) | -0.24% | 0.49% | 3.28% | 9.72% |
| Long Term Treasuries (VGLT) | -2.80% | 0.48% | -7.36% | -10.13% |
| International Bonds (BNDX) | -1.08% | -0.03% | -2.15% | -1.07% |
Fun Facts – October Edition
- The first Ford Model T was released to market in October 1908.
- Leif Erikson Day is celebrated on October 9th (not that kind of “leaf”). The day recognizes the Norse explorer who is believed to have led the first Europeans to North American soil in Newfoundland approximately 1,000 years ago.
- Sugar, (pumpkin) spice, and everything nice. Kids are getting excited for Halloween while adults are excited for the cooler autumn nights and pumpkin flavors.
- Oktoberfest began in 1810, when Prince Ludwig of Bavaria held a festival to celebrate his marriage with Therese, the princess of Saxony-Hildburghausen.
Derek Prusa, CFA, CFP® and Ben Webster, CFP®
Co-Founders and Owners of Aspire Wealth
September 2021 Newsletter
