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Aggressive Growth Leadership

U.S. stock market leadership has been narrow in 2015. As noted in our blog postdated August 19, all of the S&P 500s returns this year can be attributed to five companies (through 8/17).The remaining stocks, as a whole, detracted from performance.

This narrow leadership has been centered on aggressive growth stocks. The adjacent chart8.24.15 ranks large cap mutual funds according to their Value-Growth score (the same metric Morningstar uses for its style box). Strong returns have been limited to the most aggressive mutual funds, which also exhibit very high valuations as measured by Price-to-Earnings ratios.

2015 portfolio returns have been modest for investors who do not have sizable exposure to this area of the market. Even so, we recommend investors be cautious toward these stocks, as they are richly priced and it now has been four years since the last sizable market pullback.

DISCLAIMER: Past performance does not predict future results. This report is based on data obtained from sources we believe to be reliable. Hefren-Tillotson does not, nor any other party, guarantee the accuracy or completeness of this report or make any warranties regarding results obtained from its usage. All opinions and estimates included in this report constitute the firms judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation to buy or sell the securities herein mentioned.
Investment Advisory Team

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Hefren-Tillotson Inc. is a leading diversified financial services firm providing investment and retirement plan management and comprehensive, financial planning through MASTERPLAN® for individuals and businesses. The firm’s wealth management services are administered by Certified Financial Planner (CFP) professionals, Chartered Financial Analyst (CFA) Charter holders, attorneys, Chartered Life Underwriters, and CPA/PFS’s. Hefren-Tillotson offers corporate services including 401(k) retirement planning, executive financial counseling, fiduciary reviews and workplace financial planning seminars. Founded in 1948, the firm is headquartered in Pittsburgh and has offices located in Pittsburgh, Butler, Greensburg, North Hills, and South Hills.