Quarterly Client Letter – 3rd Quarter 2021

The major stock market averages in the U.S. continued to make new highs throughout most of the 3rd quarter, only to reverse course in September.  Still, despite declining about 5% since its September 2nd record, the S&P 500 eked out a very modest quarterly gain of 0.58%.  Small-caps, which tend to be more volatile, were down for the quarter, with the Russell 2000 returning -4.36%.  Both large- and small-caps in the U.S. are still enjoying double-digit gains year-to-date.

In international markets, the developed markets, as measured by EAFE, were very slightly negative, with a -0.35% return, but emerging markets, which, like small caps, tend to be more volatile, were down more sharply, roughly -8%.  EAFE is up nearly 9% year-to-date, and emerging markets are now slightly negative on the year. 

The Barclays Aggregate Bond Index was very nearly flat for the quarter and is slightly negative year-to-date. 

Overall, our typical client portfolios were slightly negative for the quarter, primarily due to the weakness in small-caps highlighted above. 

And yet, in spite of our long-held belief that we are in a “low-return world,” stocks, particularly here in the U.S., continue to deliver above-average returns.  Historically, long periods of above-average performance tend to be followed by long periods of below-average performance.  We expect that trend to continue.  And considering we are still enjoying what has been a prolonged period of above-average performance, we continue to think it’s prudent to expect lower returns going forward. 

With markets, and therefore portfolios, still very near all-time highs, expectations for lower returns, and no shortage of things to worry about, we understandably get questions along the lines of “should we be taking some money off the table?”  Well, the answer to that question is highly personal and depends on factors ranging from risk tolerance to age to withdrawal needs.  There is nothing wrong with maintaining enough in cash to fund short- to intermediate-term spending needs.  But for your long-term investment portfolio, the answer is no. 

Whether your portfolio allocation is all equities, or a conservative mix of stocks and bonds, the best course of action, assuming your long-term strategic allocation is still appropriate to your circumstances, is to stick to your planned allocation, and rebalance to it periodically.  But timing the market never pays off.  While this concept is well-established, we’ve seen recent research that further supports it.  In a nutshell, the cost of missing upward moves tends to be greater than the cost of staying in through downturns.  Consider this staggering statistic: since 1999, if you had just missed the top 10 trading days for the S&P 500, you would’ve enjoyed less than half of the return over the last 20+ years.  Missed the top 25 days?  You would’ve missed out on more than three-quarters of the market’s gain!   And it’s worth noting, these days tend to follow the worst days.  In fact, 21 of the 25 worst days since 1999 were followed, within a month, by one of the best 25 trading days.  

Our prescription for the market conditions, as we perceive them, remains much the same.  Either directly or through mutual funds, own a carefully selected portfolio of high-quality companies that are competitively advantaged, financially sound, well-managed and reasonably valued, diversified by size and geography.  That approach has served us well for many decades and through a variety of bull and bear markets.

Finally, as always, we encourage you to make sure we have your most updated personal information, including address, employment/retirement status, phone numbers, including mobile, and preferred email addresses.  And feel free to reach out to your advisor with any questions, concerns or change of circumstance that might help us serve you better. 



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Sissy Moreland

Client Services Trading

A graduate of Mississippi State University, Sissy joined Medley & Brown in 2017, but her career goes all the way back to 1990 when she was the merchandise director for four years at Phi Theta Kappa. She was also Customer Service Manager and Marketing Development Manager at Crystal Springs Apparel from 1994 to 2005. From 2005 to 2017, she was Manager of Sales Administration at Skyhawke Technologies. Thanks to her considerable operations and administrative experience, Sissy oversees trading and assists with most back-office operations for the firm. Staying so busy at work requires Sissy to recharge her batteries outside the office from time to time which she does by running, reading, enjoying a leisurely brunch, and watching the Saints play football.

Beth Braswell

Client Services Coordinator

Beth spent four years in the investment world before joining Medley & Brown in 2004 as our operations coordinator. She and her husband Robbie are busy parents to identical triplet daughters, so not surprisingly, some of Beth’s favorite things to do are napping and relaxing on the beach when she actually finds the time. Beth also enjoys taking short walks to the pool, attending concerts, and going out of town for long weekends. Beth loves her Mississippi State bulldogs and currently has four dogs, three cats, and three grandcats because having three children simply isn’t enough. No wonder her operational skills are so exceptional.

Doug Muenzenmay, CFA, CFP®

Senior Advisor   |   Principal

When he’s not enjoying the outdoors or attending his children’s school and sporting events, you can find Doug studiously researching investments for his clients. His career began in 1991 after graduating from the University of Iowa with a bachelor’s degree in economics. He spent 17 years in trust investments at three different banks before joining Medley & Brown in 2010. Doug also got his MBA from Mississippi College and served as an adjunct professor in finance there from 2007 to 2013. Married to his wife Sharon since 2001, Doug is a Chartered Financial Analyst (CFA), Certified Financial Planner (CFP), and a board member of the CFA Society of Mississippi.

Eddie Carlisle, CFP®

Senior Advisor  |   Principal  |  Chief Compliance Officer

Eddie’s extensive education includes a B.S.B.A. in accounting, with special distinction, from Mississippi College in 1994, along with a J.D. from Vanderbilt University and LL.M. (Master of Laws) in taxation from the University of Florida. But it’s what he’s learned outside of school and work that really stands out. He’s an Eagle Scout, which taught him a great deal about honesty and hard work from an early age. He learned even more earning black belts in Taekwondo, Hapkido, and Hanmudo. Oh, and he studies the Korean language in his spare time as well. Additionally, Eddie serves as an adult leader for Scout Troop 164 in Madison. He is a past board member of Hope Hollow Ministries, the Central Mississippi Down Syndrome Society, and the Mississippi Corporate Counsel Association. Eddie is currently a board member of the Woodward Hines Education Foundation. He enjoys spending time with his wife, Sarah, and their three children—Andrew, Caroline, and Emma. 

Julius Ridgway

Senior Advisor   |   Principal

Judging from his background, you’d think investments and other financial matters were all Julius cares about. After all, he has two decades of direct investment experience and spent the previous ten years involved in banking and real estate. Julius also received a masters degree from the London School of Economics in 1998, an MBA from Millsaps College in 1993, and a history degree from the University of Mississippi in 1990. But his true passions include driving sports cars on racetracks or twisty mountain roads, running ultramarathons, and taking road trips with his wife and son. He’s worked here since 2002 as a Chartered Financial Analyst (CFA) and member of the CFA Institute while also serving as an adjunct instructor at Millsaps College and board member of New Stage Theatre. It takes major dedication to tackle all these responsibilities—sort of like training for all those long distant runs—but Julius enjoys every minute of the grind. And when it’s time to slow down, Julius finds the best way to clear his head is taking long hikes in the mountains on all those road trips.