2020 Q2 Letter to Investors & Introduction of the International Fundamental Stability & Value Strategy
We introduce our International Fundamental Stability and Value strategy (Intl. FSV) and discuss performance and portfolio changes in the U.S. FSV portfolio related to the attractive opportunity set we are seeing within an increasingly bifurcated market.
A Lopsided Crisis
The economic impacts of the coronavirus crisis are extremely uneven. Estimates of free cash flow for stocks in hard-hit industries are down 90%. The free cash flow estimates for the remainder of the market have held nearly steady, down just 5% over the same period.
2020 Q1 Letter to Investors: The Corona-Crisis and Prospects for Recovery
In addition to providing updates on strategy performance and portfolio changes, we look at the current economic crisis brought on by the outbreak of COVID-19 as well as the possible innovation-driven path to recovery. We see our investment process particularly well suited for this environment.
March 2020: Interim Update to Investors
While market prices, in theory, should reflect the discounted value of a very long stream of future cash flows, they are prone to panic and often overreact to near-term disruptions. The current environment, brought on by worries of the spreading COVID-19 disease, seems like exactly such an instance.
Value Failed Because it was Expensive
So-called “value” indexes have severely underperformed the broader stock market for more than a decade. While this is an often-told story, it typically comes without any compelling explanation of why these indexes of purportedly inexpensive stocks continue to disappoint.
2019 Year-end Letter to Investors: The Market Rally in a Long-Term Context
We provide an update of our U.S. Fundamental Stability & Value strategy’s performance, portfolio changes, and fundamental attributes, and discuss the equity market’s recent performance in a longer-term historical context.
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