Portfolio Manager Commentary

Our quarterly letter reviews general market and portfolio trends, followed by more in-depth comments on each portfolio, including performance attribution, new investments, and sector positioning.

Q4 Market and Portfolio Review

In the fourth quarter of 2023, equity markets posted negative returns in October before embarking on a strong market rally in November and December, resulting in positive returns for the quarter. Following a down third quarter across the broad market, the fourth quarter strength coupled with a strong first half of the year led to decisively positive returns in 2023. Investor sentiment continues to swing wildly. However, strong calendar 2023 returns were supported by resilient economic data, continued health in the labor market, a slowdown in inflation, and renewed enthusiasm for a soft landing in the economy. Sentiment received a big boost during the fourth quarter. At the November 1st meeting, the Fed backed off their commitment to rates remaining higher for longer, and on December 13th, the Fed laid out their expectations for rate cuts sometime in 2024. The restrictive monetary policy over the last 18 months could still have lingering effects on the economy, but for now, investors have cheered the “Fed pivot” to a more accommodative stance. Our philosophy, process and team remain consistent, and we continue to invest in what we believe are the fastest growing and highest quality companies in America. Please see the performance table for details.