Over 10 years we help companies reach their financial and branding goals. Maxbizz is a values-driven consulting agency dedicated.




411 University St, Seattle


September Commentary

What Happened:

· For September, the US equity markets had its first negative month of performance since January. Domestic Year-to Date performance has remained strong through the end of the 3rd quarter with major domestic indexes still holding their gains while achieving positive returns of at least + 10%. The S&P 500 has returned + 14% through the end of September. The NASDAQ index, returned a negative -5.3% in September and now stands at + 12% Year-to-Date. The Russell 2000 Index, which measures the performance of smaller sized companies returned -3% in the month of September and has returned +11.6% for the year.

· International Equity Markets also were negative in September. The developed countries as measured by the MSCI EAFE Index were down just over 3% in the month, while still finishing out September + 6% on its performance for the year. The MSCI Emerging Markets Index was down – 4% in September, bringing its year-to-date performance to now just under – 3% for 2021. The Brazilian equity markets as measured by the BOVESPA stock Index was pretty much flat coming into the month of September, it also participated in the equity market selloff loosing -6.5% in the month and now sits at -6.75% for 2021 through the end of September.

· US Fixed Income was also down in September, as measured by the Bloomberg US Aggregate Total Return Index. September’s performance was – 0.87%, bringing its total return for the year to -1.55% through the end of the third quarter. The yield on the 10 Year US Treasury rose to the 1.5% levels up from 1.3% where it began the month. We know as yields go up bond prices are going down, so we expect fixed income performance to be challenged in this low interest rate environment. In the commodities arena, Oil was one part of the market that experienced a positive month in September appreciating over 9% to now $75 a barrel. For the year Oil has appreciated +54% in 2021. In the precious metals space Gold was down just over 2% in September and now down -6% on the year pricing at $1,775 / oz. Silver was down over 8% in the month of September and now at $22 / oz. sits -16% below where it began the year.

What we Did:

· Coming off a strong 2020, the growth asset class continued to experienced a rotation to the value class. While this is not unexpected, the wealth management team has stayed true to our discipline, seeking new growth opportunities as valuation return come back down. At the same time, we are looking to make sure there is still significant runway ahead for our portfolio companies to achieve significant capital appreciation. The concern so much momentum is that some of the names in the portfolio may have reached a fair or full valuation. We continue to evaluate not just how our portfolio companies are relatively positioned within their industry versus their competitors, but also that they can continue to achieve outperformance versus other opportunities found within the equity growth mandate. Focused on long term growth, we have found short term volatility can often create great opportunities if you know what you’re looking for.

· Core Global Equity portfolio, we continue to stay the course with our global equity allocation. The portfolio has performed positively as we continue to participate in the current bull market cycle. Our continued concern for Chinese equities has helped protect on the downside. Our concern for a mid-cycle pullback has increased which is leading us to proceed with caution as we slightly increased our exposure to assets such as Gold, US Treasuries & Gold, to hedge against a possible market downturn

· In our Dividend Income Portfolio strategy, which has been the more conservative of the equity portfolios, we continued to prepare for a market pullback. The portfolio which has an income, cash flow centric focus is positioned well above our targeted yield of 2x the S&P 500. The portfolio is currently yielding approximately 3.5%, while the S&P 500 yields around 1.3%, considering the interest rate environment we feel that this level of income generation is working for our clients. The inclusion of a High Yield fixed income ETF increases the diversification of the asset allocation while also maintaining our income cash flow centric portfolio mandate.

What we are Watching:

· There were some major global news stories in recent months that have the potential to disrupt the global economy. The United States withdrawal of Afghanistan brings an end to 20 years of war. This could begin to signal a less influential U.S. around the globe.

Look for other powerful nations like China and Russia to start to assert their influence abroad in strategic locations. Areas to focus on for example; Taiwan, the Korean Peninsula, South China Sea. Also, countries like Iran or the Ukraine could serve as a hotbed of geo-political tensions, which could certainly change the landscape of the global economy. China’s recent banning of bitcoin and the default of Evergrande, China’s second largest property developer, has raised concerns over the long-term investment outlook for the world’s second largest economy as well.

· Company earnings and outlooks sentiment will be a focus as we turn the corner to head into the end of the year. September rattled the bullish investors and now some investors point to a lack of a new catalyst to bring the market higher. Severe weather and supply chain issues will be mentioned often in companies’ earnings call as negative factors that effected the bottom line. Inflation data will be in focus to see if these economic pressures are here to stay or more transitory. Non-Farm Payrolls are still way below pre pandemic levels raising concerns about the labor market. With Federal unemployment benefits rolling off the labor market could gain back some willing workers. The unemployment rate currently sits at 5.2%.

· Policy from Washington DC, always another area of focus. We’ll be watching to see if members of Congress will come to an agreement to raise the debt ceiling. The Democrats are seeking to increase taxes to help pay for their proposed $3.5 Trillion budget “reconciliation” plan as well as the infrastructure bill that has been in the works for some time. The Delta variant of COVID-19 is still a concern, lowering the demand for the travel & leisure parts of the economy. A mid-cycle pullback in equities is quite normal for this part of the economic expansion but with so much monetary stimulus & liquidity still in the financial system, how much of this positive economic momentum is real growth vs. government spending is something to keep our eye on. We will remain diligent and continue to watch these areas of concern. While we may experience some unavoidable turmoil, we will continue look to mitigate risk and limit the impact in our client portfolios.

Disclaimer: Investing in financial markets carries risk, including loss of principal. You can lose some or all of the money that is invested. Past performance is no guarantee of future results. The material contained herein is for informational purposes only. This document does not constitute a recommendation of securities, securities portfolio, transactions or investment strategies. The projections were created based on hypothetical information, there is no guarantee that any of them will come true. Proxy Financial is a registered investment adviser. Proxy and its Financial Advisors are not licensed in all states to offer securities and insurance products. This site is not a solicitation of interest in any of these products or service in any state which the registered representative is not properly licenses.