MARKET HISTORY

"There are two rules to investing;
Rule #1: Don’t lose money.
Rule #2: Don’t forget Rule #1"
-Warren Buffet
Our active investment approach is designed to preserve capital during periods of market declines and be invested in the most promising mutual funds during periods of price appreciation. A closer examination of the bond and stock markets over the last 25-30 years reveals periods when investors would have been better served to be out of the market with their money safely positioned in short-term cash equivalents. Investors who were fully invested during the following periods suffered major losses:
   
BONDS: As long as interest rates remain constant or decline bond funds do very well. But when interest rates rise the results are quite different:
  • From 1978 to 1982 bond fund accounts dropped dramatically. The value of some bond funds dropped 50% during that period
  • During the 1989-90 period certain bond mutual fund investors experienced significant losses. Losses of up to 20%
STOCKS:
  • In 1968 the Dow topped 1000 and then dropped to 600; a decline of 40%
  • In 1973 the Dow reached 1050 but by December 1974 had fallen to 550; a decrease in value of over 48%
  • Once again in 1976 the Dow topped 1000 only to fall to 750 by March 1980; a loss of over 25% over four years
  • August 1987 found the Dow peaking at over 2700 only to plunge to 1738 in less than a three month period; a decline of over 36%
  • During just six months in 1990 the Dow recorded a net decrease in value of 20%
  • From the peak in prices in March of 2000 to the trough in 2002, growth stocks lost up to 90% of their value.  Some of the most widely recognized growth funds lost up to 80% of their value.  Some of the OLDEST mutual funds including those with BLUE CHIP in their name lost over 65% from March of 2000 to the end of 2002

 

Newport's stock and bond programs are designed to protect capital during periods of market declines and take advantage of capital appreciation when stocks or bonds are rising.
Percentage Lost   Gain Required to Get Even
20%   25%
30%   43%
40%   66%
50%   100%
60%   150%
70%   233%
80%   400%
90%   900%
 



WHO ARE OUR CLIENTS ?

"Management is not being brilliant.
Management is being conscientious.
Management is doing a very few
simple things and doing them well."
-Peter Drucker
Since our inception we have been serving a diversified client base. Our services and results have proved equally valuable regardless of account size; whether it be a $25,000 account or a $5,000,000 account ! Our clients include:
  • Individuals
  • Corporations
  • Trusts
  • Institutions
  • Qualified Plans, including:
    Union Employee Retirement Plans and Health and Welfare Benefit Plans
    Profit-Sharing Plans
    Defined Benefit Plans
    Defined Contribution- Plans
    IRA’s
    401k’s

The selection of investment assets (i.e. stocks or bonds or combination) is tailored to the unique requirements and long-term objectives of each client.