| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | - | - |
Equity markets capped off a strong 2025 with continued leadership over other asset classes in Q4, supported by easing financial conditions and a weakening U.S. dollar. International equities stood out, with developed markets edging out emerging markets during the quarter, while both outpaced U.S. benchmarks. Within U.S. equities, dispersion was a defining theme as large caps outperformed small caps, while Value rebounded relative to Growth across all Russell cap tiers. Sector performance reflected a clear shift toward balance after years of Growth dominance, with Health Care emerging as the top performer supported by pharmaceutical pricing agreements with the Trump administration. The Fed resumed rate cuts in September, delivering three reductions by year-end, with markets expecting continued though slower easing in 2026. Fixed income delivered its strongest annual performance in five years as Treasury yields fell meaningfully. Looking ahead, cyclical Value sectors appear positioned to benefit if economic momentum holds and Fed easing continues, while a sustained Growth resurgence will depend on renewed confidence in AI-driven earnings.
Equity markets demonstrated resilience in Q4 2025 with a notable rotation from Growth to Value leadership, supported by Fed easing and broadening market participation beyond mega-cap technology stocks.
Markets expect continued Fed easing at a slower pace in 2026. Higher-beta, dividend non-payers have tended to lead early in easing phases, while dividend payers and high yielders may strengthen later in the cycle. Cyclical Value sectors appear positioned to benefit if economic momentum holds and Fed easing continues.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jan 16 2026 | 2025 Q4 | - | Fed, growth, inflation, international, rates, Sectors, value | - | Value rebounded relative to Growth in Q4, with Value beating Growth across all Russell cap tiers during the quarter. Cyclical Value sectors such as Financials, Materials, Industrials, and Energy outperformed, supported by resilient growth and favorable Fed policy messaging. Growth retained a narrow edge for the full year in large caps despite underperforming in Q4. Technology and Communication Services delivered exceptional longer-term returns, though near-term leadership may remain more evenly distributed. A sustained Growth resurgence will likely depend on renewed confidence in AI-driven earnings. The Fed resumed rate cuts in September, delivering three reductions by year-end as labor market risks rose. Markets expect continued, though slower, easing in 2026. The 10-year Treasury yield fell meaningfully from early-year highs, supporting fixed income performance. |
| Oct 14 2025 | 2025 Q3 | - | - | - | |
| Apr 8 2025 | 2025 Q1 | - | - | - | |
| Jan 9 2025 | 2024 Q4 | - | - | - | |
| Oct 9 2024 | 2024 Q3 | - | - | - | |
| Jul 11 2024 | 2024 Q2 | - | - | - | |
| Apr 12 2024 | 2024 Q1 | - | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2025 Q4 |
GrowthEconomic growth is accelerating according to Hedgeye's real GDP projection model, gaining significant momentum in Q1 and continuing through much of Q2 2026. This growth acceleration historically supports risk assets, particularly cyclical equities and commodities. |
Economic Growth GDP Risk Assets Cyclical Acceleration |
RatesFederal Reserve resumed rate-cutting cycle with first cut since December 2024, signaling resumption of easing. Expected three cuts of 25bps between now and first quarter 2026 as Fed responds to signs of weakness in US labor market. |
Fed Monetary Policy Labor Market Easing Liquidity | |
ValueManager emphasizes investing in controlled companies trading at significant discounts to NAV, with European holding companies showing discounts of 30-68%. The strategy focuses on securities mispricing where real value exists, contrasting with overvalued technology stocks. |
Discounts NAV Mispricing Undervalued Controlled |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
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| No Elevator Pitches found | ||||||||||
| TICKER | COMMENTARY |
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| No ticker commentary found. | |
| Ticker | Put/Call | Amount Bought | Shares Bought | % Change | Weight % |
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| Ticker | Put/Call | Amount Sold | Shares Sold | % Change | Weight % | Status |
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| Industry | Prev Quarter % | Current Quarter % | Change |
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