The Numbers

In normal times, a double-digit annual gain for a stock index would be a banner year. But these are not normal times. In the last year, the Valley 50 Stock Index gained 11.9 percent, but some of the national averages have performed even better. While the Dow Jones Industrial Average fared slightly worse than the Valley 50, the S&P 500 increased 16.8 percent and the Nasdaq has jumped 19.9 percent. Even with a stock market rally and record highs in the last few weeks, most of the gains for the year were achieved during 2013. Since New Year’s Day, the Valley 50 has increased less than 1 percent, while the Dow Jones is up a bit more than 1 percent (see page 55). Robert Katch, chief executive at wealth management firm Manchester Financial Inc. in Westlake Village, said overall, the markets haven’t moved much this year as investors wait for the economy to catch up to their enthusiasm. “2013 was probably a better year for the stock market than the economy, so in effect some of 2014’s gains were folded into 2013,” he said. Because the Valley 50 index is weighted by market capitalization, small-cap companies don’t move the needle. That leaves the heavy lifting to billion-dollar market cap companies such as staffing firm On Assignment Inc., up 38 percent over the past year, and homebuilder Ryland Group Inc., down 13.5 percent. “There are always some companies leading and some lagging, but that’s why we use an average,” Katch said. “For those companies that are leading at one point, it doesn’t mean they are better companies or investments. It’s all part of the ebb and flow of the market.” – Joel Russell