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March experienced large swings across asset classes as markets entered the ominous beginning of the bear market.

Global stocks fell (‐14.4%) as fear of the coronavirus blasted headlines. Both U.S. small value (‐26.0%) and international small value (‐19.1%) plummeted. Bonds attempted to steady markets as short‐term (+0.8%) came in positive for the month. Alternatives were not exempt from volatility while REITs came in at ‐23.1%, but managed futures provided a positive return of +3.3%.

Economy

  • With the suspension of businesses across the nation, unemployment ticked up to 4.4% in comparison to the March data of 3.5%.
  • Unemployment filings in March saw the historic weekly highs of 3.3M and 6.9M.
  • VIX market volatility rose 38.1 points this month, approaching all‐time highs.

Stocks

  • U.S. small (‐26.0%) and large value (‐16.1%) felt the weight of the pandemic as the bear market carried on.
  • A similar theme carried out in the international developed markets with small value (‐19.1%), large value closely following (‐17.7%). International small cap (‐17.1%) and large cap (‐13.3%) were negative as well.
  • Emerging markets fell (‐15.4%) as coronavirus‐related losses swept the globe.

Bonds

  • Bonds attempted to calm volatility with short‐term (0.8%) showing confidence and intermediate‐term (‐0.4%) chasing positivity.
  • TIPS (‐1.8%) and international (‐1.5%) were negative for the month.

Alternatives

  • Managed futures took the lead this month (+3.3%) for alternatives, while REITs (‐23.1%) and commodities (‐12.8%) lagged and reinsurance was roughly flat (‐1.8%).

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Source: Morningstar Direct. This is intended for informational purposes only and should not be construed as legal, investment or financial advice. Please consult your legal, investment and financial professionals regarding your specific circumstances.