GKV Capital Management is a fee-only registered advisory firm in operation since 1975. We manage separate accounts for families, charities and companies. As an independent portfolio management firm making direct investments on our clients’ behalf, GKV Capital has the flexibility and expertise to respond to the changing investment environment to reduce risk and grow wealth.
September 2014 Quarter Review
Through the end of the third quarter, the market has rewarded patient investors with modest gains but not without some bumps along the way. The third quarter began with a slide that threatened to eliminate all of the hard won gains for the year. After a sharp sell-off in July and again at the end of the quarter, the major indices pushed forward resulting in year-to-date gains of 8.3% for the S&P 500, 4.6% for the Dow Industrials and 7.6% for the Nasdaq Composite.
Our analysis and expectations have changed surprisingly little since the beginning of the year. The economic outlook remains positive although there is little to get excited about. With the reduction in stimulus to propel stock valuations, we expect prices to track earnings growth. Investor sentiment drives the market higher or lower, however it is ultimately corporate earnings that make the market cheap or expensive. Based on our view that corporate earnings are the ultimate arbiter of equity prices we look to the earnings outlook to evaluate the likely performance of the stock market in the coming months.
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