2023-2Q Letter to Investors: Expensive at the Top
June 30, 2023: A strong rally moved market levels markedly higher in the second quarter, leaving any angst of the first quarter’s focus on banking turmoil behind. The rally, however, was driven mostly by handful of the biggest stocks that look increasingly rich relative to the market overall.
2023-1Q Letter to Investors: Crosscurrents from Big Tech & Banks
April 14, 2023: Equity markets rose to start 2023 but experienced crosscurrents from very concentrated gains among a select few of the biggest stocks and weakness in the bank sector. In this environment, our U.S. Fundamental Stability & Value (US FSV) strategy lagged the S&P 500 while comfortably outpacing its value benchmark.
Year-End Letter to Investors: Value Mattered in 2022
January 11, 2023: Elevated inflation and rising rates are likely to cause economic activity to continue to moderate and even possibly contract, but from a longer-term perspective, this is not unusual and the economy and corporations have weathered much more difficult circumstances in the recent past.
2022 3Q Letter to Investors: Races are Won in the Turns
October 14, 2022: The title of this letter is an auto racing adage that aptly applies to investing. It highlights that much more than in the straightaways, it is in the turns, both entering and coming out of them, where drivers differentiate themselves.
2022 2Q Letter to Investors: YTD Sell-Off Drives Rotation
July 19, 2022: On measures of free cash flow, stocks have gotten notably less expensive in the first six months of 2022, and the first chart highlights the free cash flow yield now expected for both the U.S. FSV strategy and the S&P 500.
2022 1Q Letter to Investors: Differing Drivers of Returns
April 11, 2022: In the first quarter of 2022, each of Distillate’s strategies (U.S. FSV, Intl. FSV, and Small QV) outperformed their primary benchmarks. Crucially, performance both recently and over prior years has resulted from a very different driver of price gains compared to the market.
2021 Year-End Letter to Investors: Value Below the Surface
January 16, 2022: Distillate’s U.S. Fundamental Stability & Value (U.S. FSV) strategy outperformed its S&P 500 and iShares Russell 1000 Value ETF benchmarks again in 2021. For a further discussion of performance, portfolio changes, and more, please see our Year-End 2021 letter.
2021 3Q Letter to Investors: Valuation & Quality Update
October 18, 2021: We review recent performance of Distillate’s U.S. Fundamental Stability & Value (FSV), International FSV and Small Cap Quality & Value strategies. Amid a backdrop of strong price gains and pockets of extremely rich valuations, we believe valuation is becoming an increasingly important risk to equity returns going forward.
2021 2Q Letter to Investors: Valuation & Quality Update
July 16, 2021: In the wake of strong equity price gains across geographies and market caps, and amid pockets of very rich valuations, we review performance, portfolio changes, and how Distillate’s strategies compare to various benchmarks on measures of valuation and quality.
