Language | 
English
Spanish
The Stable Income Fund provided a net total return of +7.22%for the 2024 year as global risk markets responded positively to economic resilience and relatively accommodative world monetary and fiscal policies. The total return is inclusive of a monthly $0.035 dividend payout per unit.
The US economy demonstrated continued resilience in the fourth quarter of 2024, reinforcing the narrative of a successfully engineered “soft landing” with no imminent signs of a recession. Gross Domestic Product (GDP) expanded at an annualized rate of 2.7% in Q3 and is projected to grow at a slightly moderated pace in Q4. The labor market continued to show strength, adding 227,000 jobs in November, with the unemployment rate steady at just above 4.0%.
US equity markets delivered mixed results in Q4. The quarter began on a strong note, buoyed by mega-cap stocks and optimism following the election of President-elect Donald Trump on November 6. However, sentiment shifted sharply on December 18 when the Federal Reserve’s rate cut announcement signaled a “higher-for-longer” interest rate environment. The S&P 500 dropped 2.95% on the day, yet managed a quarterly gain of 2.07%. In contrast, the S&P 500 Equal Weighted Index fell 1.89%, highlighting significant performance dispersion.
Globally, the MSCI World Stock Index posted a marginal decline of 0.41% for the quarter. Within the broader markets, sector rotation was pronounced. Consumer Discretionary (+14.25%), Consumer Staples (+8.87%), and Financials (+7.06%) led gains, driven by expectations of tax cuts and deregulation under the incoming administration. However, rising longer-term interest rates hurt higher dividend-paying stocks in both the US and abroad. In Q4, the US Dow Jones Dividend Select Index fell by -1.85% and while the Global Dividend Select Fund fell by -7.91%.
In general, international markets faced a challenging quarter. US tariffs, slowing global economic growth, and a strengthening US dollar weighed heavily on performance. Hybrid securities were also negatively impacted by rising interest rates during the quarter. The S&P Preferred Stock index fell -4.30% and ICE Exchange-Listed Preferred and Hybrid Securities Index fell -2.97% over the period.
At quarter end, the Fund was allocated approximately 46% to hybrid securities (including preferred stock and baby bonds), 43% dividend-paying equities and 8% fixed income. The current dividend yield on the Fund was 3.71% at quarter-end based on the monthly unit payout of $0.035.
The information contained in this article is for information purposes only, and represent the views of the author. It is not intended as specific investment or financial advice, or a recommendation or solicitation to buy or sell any security. Any investments or strategies listed in this article may not be suitable for all investors. Past performance is not indicative of future performance, and as with any investment, prices may fluctuate. It is recommended that advice is sought from a qualified investment professional prior to implementing any financial plan. LOM has made every effort to ensure that the contents herein have been compiled from sources believed reliable, however LOM does not warrant the accuracy, adequacy, timeliness, or completeness of this information expressly disclaims liability for errors or omissions in this information.
