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INTRODUCTION

“The more things change, the more they stay the same”
-Jean-Baptiste Alphonse Karr

While the last 15 months have been anything but ordinary, someone simply observing financial market performance over the last three months could be excused for assuming it was business as usual.  Many of the trends that were in place before the pandemic, namely lower rates, growth/large cap outperformance and daily all-time highs in the equity indices, reestablished themselves. [Read more…] about Q2 2021 Investment Letter

INTRODUCTION

“Don’t look for the needle in the haystack. Just buy the haystack.” -Jack Bogle

In reviewing the performance of the broad market indices, one could be forgiven for assuming that it was a very orderly quarter.  Not readily apparent in the returns is the (-8%) peak-to-trough drop of QQQ (Nasdaq 100 ETF) or the precipitous drop in high growth, “stay-at-home” stocks like Zoom, Teledoc or Peleton.  Propping up the index performance, are companies in the energy, industrial and financial sectors.

Some may say that this return dispersion highlights the opportunity for active management to create alpha.  I’ve also heard that this is a “stock-pickers market” repeatedly over the last 12 months.  While there is a grain of truth to this, it is mostly marketing.  There are market winners and losers every year. [Read more…] about Q1 2021 Investment Letter

INTRODUCTION

“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of light, it was the season of darkness, it was the spring of hope, it was the winter of despair.”
– Charles Dickens, A Tale of Two Cities

As the sun sets on 2020 and I reflect on the last twelve months, I am struck by the many contradictions in our financial, political and personal lives.  Each individual’s views and experiences have been forced even wider apart over the last twelve months.  Charles Dickens could have been writing about our world in the passage above, taken from his famous book. [Read more…] about Q4 2020 Investment Letter

INTRODUCTION

“It makes no sense for individual investors to jump in and out of the market. People who trade in that way rarely die rich, whereas the patient investor often does.” – Philip Carret

Human beings’ “fight-or-flight” response was the result of an evolutionary process taking place during a very different time.  It was effective at keeping primitive man or woman safe in the face of a predator, but it makes the average person a bad investor.  While everyone understands that buying low and selling high is important to achieving investment success, too many do just the opposite in practice.  Fear causes us to sell when prices are depressed and greed encourages us to chase securities that have recently performed very well. [Read more…] about Q3 2020 Investment Letter