Dow Jones Industrial Average...Dow Jones Industrial Average – Q1 2015 Report Card March 31, 2015 3 New Closing Highs o The DJIA logged 4 new closing highs in Q1 2015, the last of

MARCH 31, 2015

With a choppier than average quarter, the Dow Jones Industrial Average closes out the period off 46.95 points or -0.26%.

CONTRIBUTOR

Jamie Farmer

Managing Director

Index Investment Strategy

[email protected]

INDEX INVESTMENT STRATEGY

Dow Jones Industrial Average

Q1 2015 Report Card

At A Glance

At Quarter End - The Dow Jones Industrial Average ended Q1 2015 at 17,776.12 – down 46.95 points or -0.26% from the close of 2014. In comparison, the DJIA’s average Q1 return over the prior 30 years is 3.18%.

Leader & Laggard – Boeing Co. (BA) contributed the most to the Average’s advance; American Express (AXP) was the leading detractor.

Industry Performance - Consumer Services was the best performing industry, Financials the worst.

Component Changes – Apple Inc. (AAPL) replaced AT&T Inc. (T) as of the opening on Thursday, March 19, 2015.

Choppy – Q1 recorded 20 daily moves of greater than 1% (up or down).

Best Day: o In Points & Percent – up 323.35 points or 1.84% on January 8th as the fall in

crude oil stabilized and central bankers affirmed a cautious stance regarding rate increases.

Worst Day: o In Points – down 332.79 points (or -1.85%) on March 10th as concerns about a

strong US dollar, tighter banking rules and uncertainty in Europe weighed on equity prices.

o In Percent – 1.86% (or -331.34 points) on January 5th as traders returned to the first full week after the holidays only to see crude oil fall below $50/barrel.

Source: S&P Dow Jones Indices. Past performance is not an indication of future results.

mailto:[email protected]

Dow Jones Industrial Average – Q1 2015 Report Card March 31, 2015

2

Performance Statistics

Long Term Performance:

Historical Annual Performance:

Recent Quarter by Quarter Performance:


History Since Inception:


Q1 1 Year 3 Year 5 Year 7 Year 10 Year

-0.26% 8.01% 34.54% 63.74% 44.96% 69.24%

2014 2013 2012 2011 2010 2009 2008 2007 2006 2005

7.52% 26.50% 7.26% 5.53% 11.02% 18.82% -33.84% 6.43% 16.29% -0.61%


3

New Closing Highs

o The DJIA logged 4 new closing highs in Q1 2015, the last of which came on March 2nd as the Average gained 155+ points to settle at 18,288.63.


Performance vs. Moving Averages

o The DJIA ended March below the 50 day moving average and above the 200 day average. o The DJIA spent the entirety of Q1 above the 200 moving average, but languished below the 50 day average

for most of January and about 1/3 of the trading days in March.



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Quarterly & Annual Returns since 1985


Q1 Q2 Q3 Q4 Annual

2015 -0.26% - - - -0.26%

2014 -0.72% 2.24% 1.29% 4.58% 7.52%

2013 11.25% 2.27% 1.48% 9.56% 26.50%

2012 8.14% -2.51% 4.32% -2.48% 7.26%

2011 6.41% 0.77% -12.09% 11.95% 5.53%

2010 4.11% -9.97% 10.37% 7.32% 11.02%

2009 -13.30% 11.01% 14.98% 7.37% 18.82%

2008 -7.55% -7.44% -4.40% -19.12% -33.84%

2007 -0.87% 8.53% 3.63% -4.54% 6.43%

2006 3.66% 0.37% 4.74% 6.71% 16.29%

2005 -2.59% -2.18% 2.86% 1.41% -0.61%

2004 -0.92% 0.75% -3.40% 6.97% 3.15%

2003 -4.19% 12.43% 3.22% 12.71% 25.32%

2002 3.82% -11.16% -17.87% 9.87% -16.76%

2001 -8.42% 6.31% -15.76% 13.27% -7.10%

2000 -5.00% -4.34% 1.94% 1.28% -6.18%

1999 6.59% 12.11% -5.78% 11.22% 25.22%

1998 11.27% 1.73% -12.39% 17.07% 16.10%

1997 2.10% 16.55% 3.55% -0.47% 22.64%

1996 9.19% 1.21% 4.02% 9.62% 26.01%

1995 8.43% 9.58% 5.11% 6.85% 33.45%

1994 -3.15% -0.30% 6.02% -0.23% 2.14%

1993 4.06% 2.36% 1.11% 5.60% 13.72%

1992 2.10% 2.57% -1.41% 0.90% 4.17%

1991 10.64% -0.24% 3.78% 5.04% 20.32%

1990 -1.67% 6.41% -14.86% 7.39% -4.34%

1989 5.77% 6.38% 10.36% 2.24% 26.96%

1988 2.54% 7.73% -1.34% 2.63% 11.85%

1987 21.56% 4.94% 7.35% -25.32% 2.26%

1986 17.58% 4.08% -6.61% 7.26% 22.58%

1985 4.56% 5.42% -0.51% 16.41% 27.66%

Average 3.18% 2.92% -0.21% 4.44% 10.47%


5

Daily Moves of 1% or Greater

o The first quarter of 2015 witnessed a greater than average number of daily returns equal to or greater than 1%: with 20 such moves during the period, 2015 has experienced the most such swings since the Financial Crisis of 2009 when 42 similar moves were recorded.


Q1 Q2 Q3 Q4 Annual

2015 20 - - - 20

2014 11 4 4 17 36

2013 4 10 4 6 24

2012 5 17 6 11 39

2011 11 12 34 32 89

2010 14 28 18 9 69

2009 42 30 17 19 108

2008 29 18 37 50 134

2007 4 9 24 19 56

2006 4 11 7 2 24

2005 5 13 3 6 27

2004 15 9 10 11 45

2003 29 19 13 10 71

2002 21 29 42 36 128

2001 24 21 28 24 97

2000 28 32 14 27 101

1999 24 22 18 19 83

1998 16 16 30 23 85

1997 19 17 18 26 80

1996 15 7 12 9 43

1995 5 4 3 5 17

1994 7 10 4 10 31

1993 8 3 3 1 15

1992 6 9 10 6 31

1991 17 17 10 12 56

1990 15 13 26 19 73

1989 14 12 10 10 46

1988 24 20 15 11 70

1987 17 18 19 42 96

1986 14 17 15 10 56

1985 11 6 3 11 31

Average 15 15 15 16 62


6

Q1 2015 Point Contribution: Who Helped, Who Didn’t

By Industry:

o Consumer Services made the largest point contribution for the quarter (123.55 points) followed by Healthcare (112.19 points) and Industrials (67.33 points).

o After an exceptionally strong Q4 ’14 (during which the sector added over 506 points), Financials reversed course and detracted the most from the DJIA in Q1 (down 109.25 points). Telecommunications (-98.24) and Oil & Gas (-94.79) rounded out the bottom three.

o Vs. 2014 – Healthcare and Consumer Services were the 2nd and 3rd biggest contributors in 2014 and their performance thus far in ’15 continues that trend. As noted, Financials made the largest contribution last year but kicks off 2015 as the worst performing DJIA industry.



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By Company:

o Boeing (BA) was the leading performer in Q1 with a contribution of 127.66 points for the period. UnitedHealth Group (UNH) took the number two spot while Disney (DIS) rounded out the top 3.

o American Express (AXP) fared the worst in Q1, removing 96.75 points as investors reacted to the loss of some large partners. Caterpillar (CAT) and Procter and Gamble (PG) were the second and third biggest detractors.

o AT&T (T), replaced by Apple (AAPL) in March, contributed nothing to the Q1 performance of the Average – contributing neither points gained or lost is a fairly rare occurrence.



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Leaders for the period are in green, laggards in red:

Source: S&P Dow Jones Indices. Past performance is not an indication of future results. *-Visa price reflects 4 for 1 stock split effective on March 19th. **-AT&T was replaced by Apple effective at the opening on March 19th.

SYMBOL NAME INDUSTRY '14 Close Q1 '15 Close Change JAN FEB MAR Q1 TOTAL

AAPL Apple Inc. Technology 110.38$ 124.43$ 12.73% NA NA -26.96 -26.96

AXP American Express Co. Financials 93.04$ 78.12$ -16.04% -79.31 5.78 -23.22 -96.75

BA Boeing Co. Industrials 129.98$ 150.08$ 15.46% 98.83 35.19 -6.36 127.66

CAT Caterpillar Inc. Industrials 91.53$ 80.03$ -12.56% -74.24 18.82 -18.76 -74.18

CSCO Cisco Systems Inc. Technology 27.82$ 27.53$ -1.04% -9.31 20.20 -12.90 -2.02

CVX Chevron Corp. Oil & Gas 112.18$ 104.98$ -6.42% -61.97 26.65 -11.35 -46.67

DD E. I. du Pont de Nemours and Co. Basic Materials 73.94$ 71.47$ -3.34% -17.53 42.64 -42.11 -17.00

DIS Walt Disney Co. Consumer Services 94.19$ 104.89$ 11.36% -20.74 84.26 4.43 67.94

GE General Electric Co. Industrials 25.27$ 24.81$ -1.82% -8.86 13.49 -7.79 -3.16

GS Goldman Sachs Group Inc. Financials 193.83$ 187.97$ -3.02% -137.56 111.61 -12.78 -38.72

HD Home Depot Inc. Consumer Services 104.97$ 113.61$ 8.23% -3.53 66.34 -7.94 54.87

IBM Intl Business Machines Corp. Technology 160.44$ 160.50$ 0.04% -45.79 55.42 -9.07 0.56

INTC Intel Corp. Technology 36.29$ 31.27$ -13.83% -20.87 1.35 -12.62 -32.14

JNJ Johnson & Johnson Health Care 104.57$ 100.60$ -3.80% -28.45 15.22 -12.48 -25.71

JPM JP Morgan Chase & Co. Financials 62.58$ 60.58$ -3.20% -52.66 44.31 -4.79 -13.14

KO Coca-Cola Co. Consumer Goods 42.22$ 40.55$ -3.96% -6.74 13.68 -17.67 -10.74

MCD McDonald's Corp. Consumer Services 93.70$ 97.44$ 3.99% -8.09 41.49 -9.27 24.13

MMM 3M Co. Industrials 164.32$ 164.95$ 0.38% -12.97 40.78 -24.14 3.66

MRK Merck & Co Inc. Health Care 56.79$ 57.48$ 1.22% 22.41 -11.17 -6.85 4.39

MSFT Microsoft Corp. Technology 46.45$ 40.66$ -12.48% -38.85 22.16 -20.98 -37.68

NKE NIKE Inc. B Consumer Goods 96.15$ 100.33$ 4.35% -25.05 31.27 21.32 27.55

PFE Pfizer Inc. Health Care 31.15$ 34.79$ 11.69% 0.64 19.72 3.12 23.48

PG Procter & Gamble Consumer Goods 91.09$ 81.94$ -10.05% -43.67 5.39 -20.94 -59.22

T AT&T Inc.** Telecommunications 33.59$ 32.65$ -2.80% -4.30 10.53 -6.23 0.00

TRV Travelers Cos Inc. Financials 105.85$ 108.13$ 2.15% -19.46 29.67 4.08 14.29

UNH Unitedhealth Group Inc. Health Care 101.09$ 118.29$ 17.01% 33.14 47.39 29.51 110.04

UTX United Technologies Corp. Industrials 115.00$ 117.20$ 1.91% -1.41 45.79 -31.03 13.35

V Visa Inc.* Financials 65.55$ 65.41$ -0.21% -46.82 105.32 -33.44 25.07

VZ Verizon Communications Inc. Telecommunications 46.78$ 48.63$ 3.95% -6.87 24.02 -5.49 11.65

WMT Wal-Mart Stores Consumer Services 85.88$ 82.25$ -4.23% -5.78 -6.74 -10.86 -23.38

XOM Exxon Mobil Corp. Oil & Gas 92.45$ 85.00$ -8.06% -32.30 7.19 -23.00 -48.12

TOTAL -658.12 967.76 -356.58 -46.95


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Dow Jones Industrial Average...Dow Jones Industrial Average – Q1 2015 Report Card March 31, 2015 3 New Closing Highs o The DJIA logged 4 new closing highs in Q1 2015, the last of