| Index | March 2003 | QTD | YTD | Description |
| S&P 500 | 0.84% | -3.59% | -3.59% | Large-cap stocks |
| DJIA | 1.28% | -4.19% | -4.19% | Large-cap stocks |
| Nasdaq Composite | 0.27% | 0.39% | 0.39% | Large-cap tech stocks |
| Russell 1000 Growth | 1.86% | -1.07% | -1.07% | Large-cap growth stocks |
| Russell 1000 Value | 0.17% | -4.87% | -4.87% | Large-cap value stocks |
| Russell 2000 Growth | 1.51% | -3.89% | -3.89% | Small-cap growth stocks |
| Russell 2000 Value | 1.07% | -5.09% | -5.09% | Small-cap value stocks |
| MSCI EAFE | -1.86% | -8.01% | -8.01% | Europe, Australasia & Far East Index |
| Lehman Aggregate | -0.08% | 1.39% | 1.39% | U.S. Government Bonds |
| Lehman High Yield | 2.88% | 7.61% | 7.61% | High-yield corporate bonds |
| Carr CTA Index | -5.80% | 3.83% | 3.83% | Managed futures |
| Through March 31, 2003. |
March '03 will go down in market history as the month that could have been. The start of the long-anticipated war in Iraq and a host of analyst upgrades resulted in an impressive 15% rally from the market's mid-month lows. But in the end, stocks only managed slight gains for March and remain in the red for the year. Notwithstanding the impressive gains of last year's fourth quarter and a few good sessions in 2003, stocks can't seem to get their groove back.
Thankfully, not all asset classes remain in a funk. High yield bonds started their runup in early October and have kept heading higher. So what's the difference between the two? For clues as to why the high-yields continued to prosper in the face of a declining equity market, one must consider that junk bonds were in a serious hole as last year's fourth quarter commenced. Thanks to the massive accounting fraud at a number of large junk issuers, 2002 turned out to be the perfect storm for defaults. According to Fitchratings.com, the number of defaulted issuers in 2002 was 163, 10 fewer than 2001′s 173. But the average size of 2002 defaults was $674 million, a 50% increase from the prior year. Further, the high-yield market was undoubtedly in a state of hangover, as the junk issued in 1997-99 represented nearly two-thirds of all defaults. The result was the widest credit spreads in years, with high-yield paper yielding nearly 1,100 basis points more than similar maturity government bonds.
