Latest Trending
Last Updated, Jan 9, 2022, 12:00 PM
Stock Funds Rose 22.5% in 2021


Once trading finished on New Year’s Eve, Dec. 31, stock indexes and stock funds were once again showing double-digit gains.



Photo:

Michael Nagle/Bloomberg News

Stocks aren’t quite immune to the virus, but they continue to overcome it.

For a third straight year, stock-fund investors pocketed big gains. The average diversified U.S.-stock fund rose 22.5% for the year, according to Refinitiv Lipper data—following gains of 19.1% in 2020 and 28.3% in the pre-pandemic year before that.

The stock-fund average gain included a 6.7% advance for the fourth quarter, as many investors remained convinced that Covid infections won’t lead to the same level of economic disruption as happened at the start of the pandemic and lockdowns in 2020.

International-stock funds were up 9.6% for 2021, including a 2.3% gain in the fourth quarter.

Underpinning the rally was an economic rebound that was stronger than many analysts had expected; companies posted some of their best-ever results.

Many investors nevertheless continued to hedge their bets. As they did in 2020, investors put more money into the relative safety of bond funds than they did into stock funds, foreign or domestic. They sent a net $587.10 billion into bond-focused mutual funds and exchange-traded funds in 2021, according to Investment Company Institute estimates. They put $113.07 billion into U.S.-stock funds and $193.19 billion into international-stock funds.

That caution, however, wasn’t rewarded. Bond funds declined in 2021. Funds tied to intermediate-maturity, investment-grade debt (the most common type of fixed-income fund) were off 1.3% for the year, including a 0.2% average decline in the fourth quarter.

The ride might be more rocky in 2022—at least according to some of the same analysts who underestimated 2021—with the Federal Reserve expected to raise interest rates, and the uncertainties of the virus and supply-chain problems.

Investors can expect 2022 to be a year of transition, says

Lauren Goodwin,

economist and portfolio strategist at New York Life Investments. Although the world is going from “peak pandemic to managing Covid-19 and more-regular life,” she says, investment managers can expect greater volatility in markets, and lower returns than in past two years, as governments’ economic supports are reduced.

Mr. Power is a Wall Street Journal features editor in South Brunswick, N.J. Email him at william.power@wsj.com.

Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Appeared in the January 10, 2022, print edition.

24World Media does not take any responsibility of the information you see on this page. The content this page contains is from independent third-party content provider. If you have any concerns regarding the content, please free to write us here: contact@24worldmedia.com

Latest Post

Common Mistakes When Using Athletic Field Tarps

Last Updated,Jun 5, 2024

High-Performance Diesel Truck Upgrades You Should Consider

Last Updated,May 14, 2024

Warehouse Optimization Tips To Improve Performance

Last Updated,May 6, 2024

Fire Hazards in Daily Life: The Most Common Ignition Sources

Last Updated,Apr 30, 2024

Yellowstone’s Wolves: A Debate Over Their Role in the Park’s Ecosystem

Last Updated,Apr 23, 2024

Earth Day 2024: A Look at 3 Places Adapting Quickly to Fight Climate Change

Last Updated,Apr 22, 2024

Millions of Girls in Africa Will Miss HPV Shots After Merck Production Problem

Last Updated,Apr 18, 2024

This Lava Tube in Saudi Arabia Has Been a Human Refuge for 7,000 Years

Last Updated,Apr 17, 2024

Four Wild Ways to Save the Koala (That Just Might Work)

Last Updated,Apr 15, 2024

National Academy Asks Court to Strip Sackler Name From Endowment

Last Updated,Apr 12, 2024

Ways Industrial Copper Helps Energy Production

Last Updated,Apr 11, 2024

The Ins and Out of Industrial Conveyor Belts

Last Updated,Apr 10, 2024