This report features world capital market performance and a timeline of events for the past quarter. It begins with a global overview, then features the returns of stock and bond asset classes in the US and international markets.
Table of Contents
RW Investment Management, LLC dba R|W Investment Management (“RWIM”) is a Registered Investment Adviser. This document is solely for informational purposes. Advisory services are only offered to clients or prospective clients where RWIM and its representatives are properly licensed or exempt from licensure. Past performance is no guarantee of future returns. Investing involves risk and possible loss of principal capital. No advice may be rendered by RWIM unless a client service agreement is in place. RWIM is not a legal or tax advisor.
Quarterly Topic: How to Feel About Consumer Feelings
FOURTH QUARTER 2024
Matt Lipps, CFA, Investment Strategist, Dimensional Fund Advisors
Does your neighbor know where the economy is headed in the next 12 months? Since the 1960s, the University of Michigan has published the popular Consumer Sentiment Index, which asks everyday folk questions like: “Are you better off or worse off financially than you were a year ago?” or “Do you think that a year from now you will be better off financially, worse off financially, or just about the same as now?”Footnote 1 This index is sometimes viewed as a beacon of how investors feel about the direction of the economy.
As of September 30, 2024, the index sat at 70.1, pessimistic relative to its long-run average of 85.1.Footnote 2 Investors interpreting this as an ominous sign for markets may not have anything to fear though, as the data show this index has not been great at predicting future returns. Plotting the level of the Consumer Sentiment Index against subsequent 12-month stock market returns shows no discernible pattern, except that stocks tend to go up more often than they go down. Out of the 226 months where the sentiment index was below the long-run average, the average equity premium over the next year was 10.6%.
If your neighbor is feeling sour, that doesn’t necessarily mean you should be changing your outlook or your investment portfolio. Markets tend to price in the latest views on the economy, including consumer optimism.
NEXT 12-MONTH US EQUITY PREMIUM AGAINST UNIVERSITY OF MICHIGAN CONSUMER SENTIMENT INDEXDecember 1978–December 2023
- “Surveys of Consumers,” The Regents of the University of Michigan, 2024. All rights reserved. Back to↩
- Current index level as of September 30, 2024. The date range for the long-run monthly average is December 1978–December 2023.Back to ↩
Past performance is no guarantee of future results.
Index Descriptions
Fama/French Total US Market Research Index: July 1926–present: Fama/French Total US Market Research Factor + One-Month US Treasury Bills. Source: Ken French website. Results shown during periods prior to each index’s inception date do not represent actual returns of the respective index. Other periods selected may have different results, including losses. Backtested index performance is hypothetical and is provided for informational purposes only to indicate historical performance had the index been calculated over the relevant time periods. Backtested performance results assume the reinvestment of dividends and capital gains.
Disclosures
The information in this material is intended for the recipient’s background information and use only. It is provided in good faith and without any warranty or representation as to accuracy or completeness. Information and opinions presented in this material have been obtained or derived from sources believed by Dimensional to be reliable, and Dimensional has reasonable grounds to believe that all factual information herein is true as at the date of this material. It does not constitute investment advice, a recommendation, or an offer of any services or products for sale and is not intended to provide a sufficient basis on which to make an investment decision. Before acting on any information in this document, you should consider whether it is appropriate for your particular circumstances and, if appropriate, seek professional advice. It is the responsibility of any persons wishing to make a purchase to inform themselves of and observe all applicable laws and regulations. Unauthorized reproduction or transmission of this material is strictly prohibited. Dimensional accepts no responsibility for loss arising from the use of the information contained herein.
This material is not directed at any person in any jurisdiction where the availability of this material is prohibited or would subject Dimensional or its products or services to any registration, licensing, or other such legal requirements within the jurisdiction.
“Dimensional” refers to the Dimensional separate but affiliated entities generally, rather than to one particular entity. These entities are Dimensional Fund Advisors LP, Dimensional Fund Advisors Ltd., Dimensional Ireland Limited, DFA Australia Limited, Dimensional Fund Advisors Canada ULC, Dimensional Fund Advisors Pte. Ltd., Dimensional Japan Ltd., and Dimensional Hong Kong Limited. Dimensional Hong Kong Limited is licensed by the Securities and Futures Commission to conduct Type 1 (dealing in securities) regulated activities only and does not provide asset management services.
RISKS
Investments involve risks. The investment return and principal value of an investment may fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original value. Past performance is not a guarantee of future results. There is no guarantee strategies will be successful.
Dimensional Fund Advisors LP is an investment advisor registered with the Securities and Exchange Commission. Investment products: • Not FDIC Insured • Not Bank Guaranteed • May Lose Value
Dimensional Fund Advisors does not have any bank affiliates.
World Stock Market Performance
MSCI ALL COUNTRY WORLD INDEX WITH SELECTED HEADLINES FROM Q4 2024
1 YEAR (Q1 2024–Q4 2024)
Q4 2024
Graph Source: MSCI ACWI Index (net dividends). MSCI data © MSCI 2025, all rights reserved. Index level based at 100 starting January 2000. It is not possible to invest directly in an index. Performance does not reflect the expenses associated with management of an actual portfolio. Past performance is not a guarantee of future results.
MSCI ALL COUNTRY WORLD INDEX WITH SELECTED HEADLINES FROM PAST 12 MONTHS
Long Term (2000–Q4 2024)
Short Term (Q1 2024–Q4 2024)
These headlines are not offered to explain market returns. Instead, they serve as a reminder that investors should view daily events from a long-term perspective and avoid making investment decisions based solely on the news.
Graph Source: MSCI ACWI Index (net dividends). MSCI data © MSCI 2024, all rights reserved. Index level based at 100 starting January 2000. It is not possible to invest directly in an index. Performance does not reflect the expenses associated with management of an actual portfolio. Past performance is not a guarantee of future results.
US Stocks
RETURNS (USD), 4TH QUARTER 2024
- The US equity market posted positive returns for the quarter and outperformed both non-US developed and emerging markets.
- Value underperformed growth.
- Small caps underperformed large caps.
- REIT indices underperformed equity market indices.
World Market Capitalization — US
$56.7 trillion
Ranked Returns (%)
Periodic Returns (%)
| Annualized | |||||||
|---|---|---|---|---|---|---|---|
| Asset Class | QTR | 1 Year | 3 Years | 5 Years | 10 Years | 15 Years | 20 Years |
| Large Growth | 7.07 | 33.36 | 10.47 | 18.96 | 16.78 | 16.45 | 12.56 |
| Large Cap | 2.75 | 24.51 | 8.41 | 14.28 | 12.87 | 13.79 | 10.39 |
| Marketwide | 2.63 | 23.81 | 8.01 | 13.86 | 12.55 | 13.56 | 10.22 |
| Small Growth | 1.70 | 15.15 | 0.21 | 6.86 | 8.09 | 10.92 | 8.32 |
| Small Cap | 0.33 | 11.54 | 1.24 | 7.40 | 7.82 | 10.33 | 7.79 |
| Small Value | -1.06 | 8.05 | 1.94 | 7.29 | 7.14 | 9.46 | 7.01 |
| Large Value | -1.98 | 14.37 | 5.63 | 8.68 | 8.49 | 10.75 | 7.89 |
Past performance is not a guarantee of future results. Indices are not available for direct investment. Index performance does not reflect the expenses associated with the management of an actual portfolio. Market segment (index representation) as follows: Marketwide (Russell 3000 Index), Large Cap (Russell 1000 Index), Large Value (Russell 1000 Value Index), Large Growth (Russell 1000 Growth Index), Small Cap (Russell 2000 Index), Small Value (Russell 2000 Value Index), and Small Growth (Russell 2000 Growth Index). World Market Cap represented by Russell 3000 Index, MSCI World ex USA IMI Index, and MSCI Emerging Markets IMI Index. Russell 3000 Index is used as the proxy for the US market. Dow Jones US Select REIT Index used as proxy for the US REIT market. MSCI data © MSCI 2025, all rights reserved. Frank Russell Company is the source and owner of the trademarks, service marks, and copyrights related to the Russell Indexes.
International Developed Stocks
RETURNS (USD), 4TH QUARTER 2024
- Developed markets outside of the US posted negative returns for the quarter and underperformed the US market, but outperformed emerging markets.
- Value outperformed growth.
- Small caps underperformed large caps.
World Market Capitalization
Developed Market
$21.1 trillion
Ranked Returns (%)
Periodic Returns (%)
| Annualized | |||||||
|---|---|---|---|---|---|---|---|
| Asset Class | QTR | 1 Year | 3 Years | 5 Years | 10 Years | 15 Years | 20 Years |
| Value | -6.55 | 6.65 | 6.04 | 5.50 | 4.54 | 4.53 | 4.36 |
| Large Cap | -7.43 | 4.70 | 1.91 | 5.10 | 5.26 | 5.25 | 4.95 |
| Small Cap | -7.86 | 2.76 | -2.77 | 2.87 | 5.49 | 6.29 | 5.68 |
| Growth | -8.31 | 2.82 | -2.26 | 4.29 | 5.72 | 5.77 | 5.38 |
Past performance is not a guarantee of future results. Indices are not available for direct investment. Index performance does not reflect the expenses associated with the management of an actual portfolio. Market segment (index representation) as follows: Large Cap (MSCI World ex USA Index), Small Cap (MSCI World ex USA Small Cap Index), Value (MSCI World ex USA Value Index), and Growth (MSCI World ex USA Growth Index). All index returns are net of withholding tax on dividends. World Market Cap represented by Russell 3000 Index, MSCI World ex USA IMI Index, and MSCI Emerging Markets IMI Index. MSCI World ex USA IMI Index is used as the proxy for the International Developed market. MSCI data © MSCI 2025, all rights reserved. Frank Russell Company is the source and owner of the trademarks, service marks, and copyrights related to the Russell Indexes.
Emerging Markets Stocks
RETURNS (USD), 4TH QUARTER 2024
- Emerging markets posted negative returns for the quarter and underperformed both US and non-US developed markets.
- Value underperformed growth.
- Small caps outperformed large caps.
World Market Capitalization - Emerging Markets
$9.0 trillion
Ranked Returns (%)
Period Returns (%)
| Annualized | |||||||
|---|---|---|---|---|---|---|---|
| Asset Class | QTR | 1 Year | 3 Years | 5 Years | 10 Years | 15 Years | 20 Years |
| Growth | -6.91 | 10.30 | -3.90 | 1.32 | 4.34 | 3.89 | 6.26 |
| Small Cap | -7.19 | 4.79 | 2.11 | 8.56 | 5.73 | 4.79 | 7.66 |
| Large Cap | -8.01 | 7.50 | -1.92 | 1.70 | 3.64 | 3.01 | 6.01 |
| Value | -9.21 | 4.51 | 0.16 | 1.96 | 2.81 | 2.04 | 5.66 |
Past performance is not a guarantee of future results. Indices are not available for direct investment. Index performance does not reflect the expenses associated with the management of an actual portfolio. Market segment (index representation) as follows: Marketwide (Russell 3000 Index), Large Cap (Russell 1000 Index), Large Value (Russell 1000 Value Index), Large Growth (Russell 1000 Growth Index), Small Cap (Russell 200 Index), Small Value (Russell 2000 Value Index), and Small Growth (Russell 2000 Growth Index). World Market Cap represented by Russell 3000 Index, MSCI World ex USA IMI Index, and MSCI Emerging Markets IMI Index. Russell 3000 Index is used as the proxy for the US market. Dow Jones US Select REIT Index used as proxy for the US REIT market. MSCI data © MSCI 2024, all rights reserved. Frank Russell Company is the source and owner of the trademarks, service marks, and copyrights related to the Russell Indexes.
Country Returns
RETURNS (USD), 4TH QUARTER 2024
Past performance is not a guarantee of future results.
Country returns are the country component indices of the MSCI All Country World IMI Index for all countries except the United States, where the Russell 3000 Index is used instead. Global is the return of the MSCI Al Country World IMI Index. MSCI index returns are net dividend. Indices are not available for direct investment. Their performance does not reflect the expenses associated with the management of an actual portfolio Frank Russell Company is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. MSCI data © MSCI 2025, all rights reserved.
Real Estate Investment Trusts (REITs)
RETURNS (USD), 4TH QUARTER 2024
- US real estate investment trusts outperformed non-US REITs during the quarter.
Total Value of REIT Stocks
$1,037 billion 103 REITS
$409 billion 268 REITs (25 other countries)
Ranked Returns (%)
Periodic Returns (%)
| Annualized | |||||||
|---|---|---|---|---|---|---|---|
| Asset Class | QTR | 1 Year | 3 Years | 5 Years | 10 Years | 15 Years | 20 Years |
| US REITS | -5.93 | 8.10 | -3.02 | 3.40 | 4.89 | 8.78 | 6.49 |
| Global ex US REITS | -15.37 | -7.83 | -9.00 | -5.25 | 0.05 | 3.22 | 2.15 |
Past performance is not a guarantee of future results. Indices are not available for direct investment. Index performance does not reflect the expenses associated with the management of an actual portfolio. Number of REIT stocks and total value based on the two indices. All index returns are net of withholding tax on dividends. Total value of REIT stocks represented by Dow Jones US Select REIT Index and the S&P Global ex US REIT Index. Dow Jones US Select REIT Index used as proxy for the US market, and S&P Global ex US REIT Index used as proxy for the World ex US market. Dow Jones and S&P data © 2024 S&P Dow Jones Indices LLC, a division of S&P Global. All rights reserved
Commodities
Returns (USD), 4th Quarter 2024
The Bloomberg Commodity Total Return Index returned -0.45% for the fourth quarter of 2024.
Sugar and Nickel were the worst performers, returning -14.29% and -13.81% during the quarter, respectively. Coffee and WTI Crude Oil were the best performers, returning +18.51% and +7.10% during the quarter, respectively.
| Asset Class | Commodities | |
|---|---|---|
| QTR | -0.45 | |
| 1 Year | 5.38 | Annualized |
| 3 Years | 4.05 | |
| 5 Years | 6.77 | |
| 10 Years | 1.28 | |
| 15 Years | -1.04 | |
| 20 Years | -0.30 | |
Ranked Returns (%)
Past performance is not a guarantee of future results. Index is not available for direct investment. Index performance does not reflect the expenses associated with the management of an actual portfolio. Commodities returns represent the return of the Bloomberg Commodity Total Return Index. Individual commodities are sub-index values of the Bloomberg Commodity Total Return Index. Data provided by Bloomberg.
Fixed Income
RETURNS (USD), 4TH QUARTER 2024
Within the US Treasury market, interest rates generally increased during the quarter.
On the short end of the yield curve, the 1-Month US Treasury Bill yield decreased 53 basis points (bps) to 4.40%, while the 1-Year US Treasury Bill yield increased 18 bps to 4.16%. The yield on the 2-Year US Treasury Note increased 59 bps to 4.25%.
The yield on the 5-Year US Treasury Note increased 80 bps to 4.38%. The yield on the 10-Year US Treasury Note increased 77 bps to 4.58%. The yield on the 30-Year US Treasury Bond increased 64 bps to 4.78%.
In terms of total returns, short-term US treasury bonds returned -0.83% while intermediate-term US treasury bonds returned -1.70%. Short-term corporate bonds returned -0.40% and intermediate-term corporate bonds returned -1.40%.Footnote 1
The total returns for short- and intermediate-term municipal bonds were -0.40% and -1.30%, respectively. Within the municipal fixed income market, general obligation bonds returned -1.18% while revenue bonds returned -1.25%.Footnote 2
US Treasury Yield Curve (%)
Yield Across Issuers (%)
Periodic Returns (%)
| Annualized | |||||||
|---|---|---|---|---|---|---|---|
| Asset Class | QTR | 1 Year | 3 Years | 5 Years | 10 Years | 15 Years | 20 Years |
| Bloomberg U.S. High Yield Corporate Bond Index | 0.17 | 8.19 | 2.92 | 4.21 | 5.17 | 6.44 | 6.45 |
| ICE BofA US 3-Month Treasury Bill Index | 1.17 | 5.25 | 3.89 | 2.46 | 1.77 | 1.20 | 1.66 |
| ICE BofA 1-Year US Treasury Note Index | 0.70 | 4.75 | 2.78 | 2.01 | 1.63 | 1.22 | 1.82 |
| FTSE World Government Bond Index 1-5 Years (hedged to USD) | 0.15 | 4.31 | 1.59 | 1.43 | 1.67 | 1.71 | 2.39 |
| Bloomberg Municipal Bond Index | -1.22 | 1.05 | -0.55 | 0.99 | 2.25 | 3.21 | 3.49 |
| Bloomberg U.S. TIPS Index | -2.88 | 1.84 | -2.30 | 1.87 | 2.24 | 2.86 | 3.30 |
| Bloomberg U.S. Aggregate Bond Index | -3.06 | 1.25 | -2.41 | -0.33 | 1.35 | 2.37 | 3.01 |
| FTSE World Government Bond Index 1-5 Years | -3.38 | 0.11 | -1.44 | -0.52 | 0.11 | -0.05 | 1.00 |
| Bloomberg U.S. Government Bond Index Long | -8.60 | -6.37 | -11.91 | -5.17 | -0.61 | 2.76 | 3.35 |
- Bloomberg US Treasury and US Corporate Bond Indices. Back to ↩
- Bloomberg Municipal Bond Index. Back to ↩
One basis point (bps) equals 0.01%. Past performance is not a guarantee of future results. Indices are not available for direct investment. Index performance does not reflect the expenses associated with the management of an actual portfolio. Yield curve data from Federal Reserve. State and local bonds and the Yield to Worst are from the S&P National AMT-Free Municipal Bond Index. AAA-AA Corporates represent the ICE BofA US Corporates, AA-AAA rated. A-BBB Corporates represent the ICE BofA Corporates, BBB-A rated. Bloomberg data provided by Bloomberg. US long-term bonds, bills, inflation, and fixed income factor data © Stocks, Bonds, Bills, and Inflation (SBBI) Yearbook™, Ibbotson Associates, Chicago (annually updated work by Roger G. Ibbotson and Rex A. Sinquefield). FTSE fixed income indices © 2025 FTSE Fixed Income LLC, all rights reserved. ICE BofA index data © 2025 ICE Data Indices, LLC. S&P data © 2025 S&P Dow Jones Indices LLC, a division of S&P Global. All rights reserved. Bloomberg data provided by Bloomberg.
Global Fixed Income
YIELD CURVES, 4TH QUARTER 2024
Interest rates generally increased across global developed markets for the quarter.
Realized term premiums were generally negative across global developed markets, as longer-term bonds generally underperformed shorter-term bonds.
In the UK, Germany, Canada and Australia, the short-term segment of the yield curve remained inverted.
US
UK
Germany
Japan
Canada
Australia
Changes in Yields (BPS) Since 09/30/2024
| Country | 1Y | 5Y | 10Y | 20Y | 30Y |
|---|---|---|---|---|---|
| US | 24.9 | 81.7 | 80.8 | 69.5 | 70.1 |
| UK | -23.5 | 51.2 | 57.5 | 55.8 | 52.2 |
| Germany | -23.0 | 20.2 | 23.5 | 12.8 | 14.7 |
| Japan | 20.2 | 22.6 | 22.0 | 16.1 | 14.1 |
| Canada | -26.4 | 26.6 | 25.8 | 19.1 | 19.0 |
| Australia | 14.7 | 32.9 | 38.0 | 30.9 | 27.1 |
One basis point (bps) equals 0.01%. Source: ICE BofA government yield. ICE BofA index data © 2025 ICE Data Indices, LLC.
Quarterly Market Summary
RETURNS (USD), AS OF DECEMBER 31, 2024
| US Stock Market |
International Developed Stocks |
Emerging Markets Stocks |
Global Real Estate |
US Bond Market |
Global Bond Market ex US |
|
|---|---|---|---|---|---|---|
| Q4 2024 | STOCKS | BONDS | ||||
| 2.63% ▲ |
-7.43% ▼ |
-8.01% ▼ |
-9.02% ▼ |
-3.06% ▼ |
0.74% ▲ |
|
| Since Jan. 2001 | ||||||
| Average Quarterly Return |
2.4% | 1.6% | 2.5% | 2.2% | 0.9% | 1.0% |
| Best Quarter |
22.0% 2020 Q2 |
25.9% 2009 Q2 |
34.7% 2009 Q2 |
32.3% 2009 Q3 |
6.8% 2023 Q4 |
5.4% 2023 Q4 |
| Worst Quarter |
-22.8% 2008 Q4 |
-23.3% 2020 Q1 |
-27.6% 2008 Q4 |
-36.1% 2008 Q4 |
-5.9% 2022 Q1 |
-4.1% 2022 Q1 |
Long-Term Market Summary
RETURNS (USD), AS OF DECEMBER 31, 2024
| US Stock Market |
International Developed Stocks |
Emerging Markets Stocks |
Global Real Estate |
US Bond Market |
Global Bond Market ex US |
|
|---|---|---|---|---|---|---|
| 1 Year | STOCKS | BONDS | ||||
| 23.81% ▲ |
4.70% ▲ |
7.50% ▲ |
2.77% ▲ |
1.25% ▲ |
4.97% ▲ |
|
| 5 Years | ||||||
| 13.86% ▲ |
5.10% ▲ |
1.70% ▲ |
0.46% ▲ |
-0.33% ▼ |
1.01% ▲ |
|
| 10 Years | ||||||
| 12.55% ▲ |
5.26% ▲ |
3.64% ▲ |
2.98% ▲ |
1.35% ▲ |
2.43% ▲ |
|
Past performance is not a guarantee of future results. Indices are not available for direct investment. Index performance does not reflect the expenses associated with the management of an actual portfolio. Market segment (index representation) as follows: US Stock Market (Russell 3000 Index), International Developed Stocks (MSCI World ex USA Index [net dividends]), Emerging Markets (MSCI Emerging Markets Index [net dividends]), Global Real Estate (S&P Global REIT Index [net dividends]), US Bond Market (Bloomberg US Aggregate Bond Index), and Global Bond Market ex US (Bloomberg Global Aggregate ex-USD Bond Index [hedged to USD]). S&P data © 2025 S&P Dow Jones Indices LLC, a division of S&P Global. All rights reserved. Frank Russell Company is the source and owner of the trademarks, service marks, and copyrights related to the Russell Indexes. MSCI data © MSCI 2025, all rights reserved. Bloomberg data provided by Bloomberg.
Accessibility Statement
This website is run by R|W Investment Management. We strive to make our website as accessible as possible. If you would like to receive this content in a different way, please contact us toll-free at (844) 834-7500.