2024 Q3 IUL Update: Performance of Major Indices

S&P 500 Reaches New Highs

The S&P 500 has reached consecutive record highs, which is great news for policyholders of Indexed Universal Life (IUL) insurance linked to the S&P 500 index. Over the past year, the S&P 500 has risen by approximately 16%, showcasing its strength and positive trajectory.

A rising S&P 500 means potential for greater crediting rates, boosting the cash value growth within these IUL insurance policies. This cash value growth can provide policyholders with increased financial security and more opportunities for tax-advantaged growth, enhancing the long-term benefits of their IUL policies.

Nasdaq's Strong Performance

The Nasdaq 100 has also shown solid performance, driven by gains in technology stocks. Over the last year, the Nasdaq 100 has risen by around 24%, largely due to strong gains in the tech sector.

For IUL holders tied to the Nasdaq index, this means enhanced cash accumulation opportunities. The technology sector's resilience and growth potential make Nasdaq-linked IUL insurance policies an attractive option for those looking to capitalize on the tech market's upward momentum.

S&P 500 Sharia Index Performance

The S&P 500 Sharia Index has demonstrated solid growth over the past year, rising by approximately 15%. This growth provides positive outcomes for IUL policyholders linked to this index. The Sharia-compliant version of the S&P 500, which excludes non-permissible sectors such as alcohol, gambling, and financial services, has shown growth in line with its traditional counterpart, reflecting the broader market's resilience and offering potential for favorable crediting rates within Sharia-compliant IUL policies.

Policyholders linked to the S&P 500 Sharia Index can benefit from diversified growth opportunities while adhering to ethical investing principles. This performance highlights the index's potential as a strong, faith-aligned choice for those seeking cash value growth within their IUL policies.

Russell 2000 Performance

The Russell 2000 Index, which tracks the performance of US small-cap companies, has also shown considerable gains, rising by approximately 12% over the past year. This index represents a different segment of the market compared to the large-cap focused S&P 500 and Nasdaq, providing exposure to the small-cap growth sector.

For IUL policyholders linked to the Russell 2000, this performance can mean higher crediting rates and improved cash value growth. The small-cap sector often offers higher growth potential, albeit with more volatility, making Russell 2000-linked IUL policies an attractive option for those looking to capitalize on the opportunities within smaller, high-growth companies.

Hang Seng Index Performance

The Hang Seng Index, which represents major companies listed on the Hong Kong Stock Exchange, has experienced moderate growth of around 8% over the past year. This performance reflects the resilience of the Asian markets amid global economic challenges.

IUL policies linked to the Hang Seng Index offer policyholders exposure to some of the largest and most influential companies in the Asian market. This geographic diversification provides an additional layer of growth potential, helping policyholders build cash value in their IUL policies through exposure to the dynamic and growing Asian economy.

EURO STOXX 50 Performance

The EURO STOXX 50 Index, which tracks the 50 largest companies across the Eurozone, has risen by approximately 10% over the past year. The index reflects the performance of major European industries, including consumer goods, financials, and technology.

For IUL policyholders linked to the EURO STOXX 50, this performance indicates potential for cash value accumulation through exposure to established European market leaders. The diversified nature of the EURO STOXX 50 makes it an appealing choice for those looking for a balanced approach to growth, combining stability with moderate potential for upside in their IUL policies.

Summary

The strong performance of indices such as the S&P 500, Nasdaq 100, S&P 500 Sharia Index, Russell 2000, Hang Seng Index, and EURO STOXX 50 offers a positive outlook for IUL policyholders. These indices provide diverse opportunities for cash value growth through exposure to different sectors, market caps, and geographic regions, enhancing the flexibility and potential of IUL policies as a powerful financial planning tool.