It hasn’t been a happy new year so far for fund investors.
The average diversified U.S.-stock fund declined 6.7% in January, coming off a pandemic-defying 22.5% rally for all of 2021, according to Refinitiv Lipper data.
International-stock funds declined 4.4%, after having rallied 9.6% in 2021.
What happened? The market’s rally during the pandemic and lockdowns had been driven by good corporate earnings, supported by the Federal Reserve. But signals from Fed officials about cutting back on its support faster than expected, to fight inflation, sent investors scurrying. January was the worst month for the overall market since March 2020, the month the pandemic took hold.
Scoreboard
January 2022 fund performance,
total return by fund type.
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