Series One Letter
I am pleased to deliver to you the American Growth Fund Series One Semi-Annual Report for the six months ending January 31, 2017.
Since our last letter to you, our government has seen major change as the Grand Old Party's candidate, President Trump, and his staff transition into their new positions. For many of us as outsiders to this process, this transition seems to be rather rough. However, one area that has been enjoying the new leadership team is the securities market. Following President Trump's address to Congress, the Dow Jones Industrial Market topped 21,000 for the first time ever1.
Your American Growth Fund Series One Class A Shares delivered you a 12.77% return since January 31, 2016 through close of business on January 31, 2017. The Dow Jones Industrial Average posted a gain of 23.89 while the S&P 500 posted a gain of 20.04% for the same time period as listed above. Of the stocks in your Series One portfolio, most of them contributed to the growth of the Fund. The top three active performing investments were Lincoln National Corp whose market value rose 54.59% (a total portfolio gain of 2.06%), Teradyne Inc. whose market value rose 43.56% (a total portfolio gain of 2.01%) and Time Warner, Inc. whose market value rose 25.90% (a total portfolio gain of 1.99%).
Unfortunately, not all investments fared as well. Amgen, Inc.'s market value fell 8.98% (a total portfolio loss of 0.58%), Dollar Tree, Inc.'s market value fell 19.75% (a total portfolio loss of 0.49%) and Bristol Myers' market value fell 35.77% (a total portfolio loss of 0.78%).
The investment sectors that had the most positive influence on your Series One portfolio were Insurance (Life), Semiconductor Capital Equipment and Entertainment industries. The investment sectors that had the most adverse effect on your portfolio were Retail Store, Drug and Biotechnology industries.
Additional data, including long-term performance data, can be located on page 32 of this report. Past performance is no guarantee of future results.
The American economy continues to improve, evidenced by the real gross domestic product (GDP) increase of 1.9% in the fourth quarter of 2016. In the third quarter, real GDP increased 3.5%. This is according to the second estimate released by the Bureau of Economic Analysis. "The general picture of economic growth remains the same; the increase in personal consumption expenditures was larger and increases in state and local government spending and in nonresidential fixed investment were smaller than previously estimated4". Additionally, unemployment has remained stable 4.7% in February of 2017. In the past ten months unemployment rates have varied between 4.7% and 4.9%5.
Over the next six months we will see some new changes to the world.
Most interesting is Brexit which indications show may be initiated March
29, 20176. Other items that our Investment Committee will be monitoring
include; the dollar's value against the world currency, the price of oil
and how it effects the world economy, the European economy and how Brexit
may affect it, as well as the Chinese economy.
My staff and I are always available to discuss your account or answer any question you might have. Please call our toll free number, 800 525-2406 or, within Colorado, 303-626-0600.
American Growth Fund wishes you A Good Future!
Capital Brokerage, Inc.
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