| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | - | - |
Carrington delivered strong Q3 performance across all portfolios as global markets rallied following volatile Q2 conditions. The firm maintains significant overweight positions in Asia, particularly China, where valuations remain attractive and economic fundamentals are solid despite ongoing trade tensions with the U.S. Gold continues as a key overweight position, benefiting from rising inflation expectations, falling interest rates, and geopolitical uncertainty. The firm has reduced U.S. equity exposure due to stretched valuations, with the S&P 500 reaching dot-com bubble-level price-to-earnings multiples and the Magnificent 7 representing 40% of market capitalization. Key risks include elevated U.S. market concentration, uncertain tariff impacts on corporate earnings, and persistent inflation above Fed targets. The Federal Reserve began cutting rates in September, while the ECB has been more aggressive in easing policy. Portfolio positioning emphasizes Asian equities, precious metals miners, and selective European exposure while maintaining government bonds as downside protection. The outlook remains cautiously optimistic with continued focus on attractive valuations outside the U.S. market.
Carrington maintains a globally diversified approach with overweight positions in Asia and Europe while underweighting expensive U.S. markets, using gold and government bonds as hedges against ongoing macro uncertainties including trade tensions and elevated valuations.
The firm expects continued volatility with ongoing monitoring of the rapidly changing environment. They remain constructive on Asia given solid economic positioning and attractive valuations, while maintaining underweight positions in U.S. equities due to stretched valuations. Gold is expected to continue performing well as a hedge against geopolitical uncertainty and inflation expectations.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Oct 20 2025 | 2025 Q3 | ^FTSE, ^GSPC, ^HSI, BTC-USD, GLD | AI, Asia, China, Europe, gold, rates, tariffs, Valuations | - | Carrington delivered strong Q3 returns while maintaining overweight positions in Asia and gold, underweighting expensive U.S. markets. Chinese equities outperformed significantly as valuations remain attractive. U.S. markets face concentration risk with Magnificent 7 at 40% of S&P 500. Fed began cutting rates while trade tensions persist. Portfolio emphasizes Asian equities and precious metals as hedges against macro uncertainty. |
| Apr 4 2025 | 2025 Q1 | ABBV, ACLX, ARGX, AZN, BSX, CDTX, COO, HRTX, INSM, IONS, ISRG, JNJ, LLY, MASI, RDNT, ROIV, SYK, TMO, UNH, WAT, XENE | AI, Biotechnology, GLP1, healthcare, M&A, Medical Devices, Pharmaceuticals | - | Baron Health Care Fund gained 5.39% in Q3 2025, driven by strong biotechnology stock selection led by argenx and Insmed. AI-driven healthcare solutions also contributed positively. Healthcare equipment and pharmaceutical holdings weighed on performance. The manager added 16 new positions, capitalizing on sector underperformance. Long-term outlook remains positive given aging demographics and technological advances in healthcare. |
| Feb 9 2026 | 2024 Q4 | - | Artificial Intelligence, asset allocation, Market Concentration, policy risk, Valuation discipline | - | |
| Oct 9 2024 | 2024 Q3 | - | Defensive Assets, Geopolitical Risk, Gold Exposure, Market Volatility, Regional Allocation | - | |
| Jan 9 2024 | 2023 Q4 | GLXY.TO, LRCX, META, MSFT, MU, SOXX, V, VOO | AI, Fed policy, Global Markets, large cap, Portfolio Management, semiconductors, technology | - | Alpine Capital maintains concentrated exposure to AI infrastructure beneficiaries and semiconductors following successful Q3 rotations. With Fed rate cuts supporting risk assets and AI spending by mega-caps backed by strong cash flows, the manager stays disciplined in patient capital deployment. Despite acknowledging semiconductor sector risks and geopolitical tensions, they position for long-term outperformance through quality selection and volatility acceptance. |
| Apr 12 2023 | 2023 Q1 | - | consumer, earnings, Fed policy, inflation, Markets, Trade Policy | - | Strong Q2 2025 equity performance driven by cooling inflation and robust earnings, with S&P 500 up 10.2% and NASDAQ gaining 16.7%. Fed maintains patient stance on rates while trade policy shifts create selective volatility. Technology sectors outperformed dramatically while consumer confidence concerns and trade uncertainty present ongoing risks to sustained market momentum. |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2025 Q3 |
AsiaAsia remains a large overweight position with attractive valuations and strong company balance sheets. Chinese equities were standout performers supported by renewed confidence in the domestic economy. The firm maintains constructive views on China given its solid economic position, low inflation, and healthy growth outlook. |
China Valuations Growth Stimulus |
GoldGold remains an overweight position despite some profit-taking in Q2. It continues to climb higher due to rising long-term inflation expectations, falling interest rates, and ongoing geopolitical uncertainty. Gold miners have performed very strongly and still have a strong outlook while providing a hedge against potentially worsening tariff sentiment. |
Inflation Rates Geopolitical Hedge Miners | |
Trade PolicyTariff headlines dominated market sentiment with President Trump escalating trade tensions with China. The full impact of new tariffs remains uncertain due to lagging economic data. Many US companies accelerated imports earlier in the year and continue to draw down inventories purchased before tariffs took effect, distorting key economic indicators. |
Tariffs China Trade Inflation Inventories | |
AIThere is rising concern about the longevity of AI capital expenditure which is yet to deliver consistent profits amid fierce competition. The Magnificent 7 now account for roughly 40% of total S&P 500 market capitalization, raising concentration and systemic risk. China continues to make meaningful progress in AI technology without the excessive capital expenditure seen in the US. |
Capex Profits Competition Concentration Technology | |
RatesFed Chair Powell announced a 25 basis point interest rate cut in September, marking the first reduction since December 2024. The decision was driven by a weakening labor market rather than progress on inflation. The ECB has been cutting consistently since June 2024 from 4.25% to 2.15% to stimulate the Euro area. |
Fed Labor ECB Stimulus Policy | |
| 2025 Q1 |
BiotechnologyStrong stock selection in biotechnology contributed the vast majority of relative gains, with main drivers being argenx SE and Insmed Incorporated. The quarter saw several positive biotechnology clinical data readouts, a strong rebound in biotechnology funding, and an acceleration in M&A activity. |
FcRn inhibitors Autoimmune Pulmonary diseases Clinical trials Drug approvals |
GLP1Eli Lilly's GLP-1 treatments for diabetes and obesity remain a key focus. The manager expects the GLP-1 drug class to become the standard of care for diabetes and obesity, ultimately representing a $150 billion-plus market, with continued uptake driving a near doubling of Lilly's total revenues by 2030. |
Diabetes Obesity Oral therapy Standard of care Market expansion | |
AIAI-driven solutions are creating value across healthcare, with Heartflow's AI-driven coronary artery disease management platform and RadNet's AI capabilities highlighted. The manager sees margin expansion opportunities as AI algorithms improve with scale and data, enabling reduced employee hours in real-time workflows. |
Medical imaging Diagnostic accuracy Workflow automation Scale benefits Margin expansion | |
Biopharma M&AThe third quarter saw an acceleration in M&A activity in biotechnology. The manager references Roivant's proven model with Telavant's sale to Roche for $7.1 billion and expects several data readouts to de-risk multiple blockbuster opportunities, further proving business models and generating upside. |
Deal activity Valuations Pipeline assets Strategic buyers Value realization | |
| 2023 Q4 |
AIOrganizations must prioritize AI investments to avoid obsolescence, with hyperscalers like Amazon, Google, and Microsoft redirecting infrastructure spending toward AI initiatives. AI promises cost reductions and technological breakthroughs while displacing human labor and unlocking novel efficiencies. The current AI spending dynamic is backed by robust cash flows rather than debt, enabling sustained commitment and tremendous agility. |
Data Centers Cloud Semiconductors Technology Infrastructure |
SemiconductorsThe manager executed a rotation from Micron to the iShares Semiconductor ETF and added Lam Research, viewing the semiconductor sector as benefiting from AI infrastructure spending. While the Micron sale proved bittersweet as it continued rallying, the semiconductor ETF still outperformed the benchmark. |
Semi Equipment Memory Technology AI | |
RatesThe Fed executed its first rate cut of the cycle in September to a 4.00%-4.25% range amid cooling inflation and rising unemployment concerns. Two additional 25bps cuts are anticipated this year, with the Fed pivoting focus from inflation to the labor market, creating a supportive environment for risk assets. |
Liquidity Inflation Growth | |
| 2023 Q1 |
InflationBoth Consumer Price Index and Producer Price Index showed meaningful cooling, with CPI declining 0.1% in June 2025 marking the first monthly drop since May 2020. Core CPI rose just 0.1% in June, the smallest increase since August 2021, supporting valuations across sectors. |
CPI PPI Disinflation Core Prices |
Trade PolicyNewly imposed tariffs on select imports, particularly in tech and renewable energy sectors, reshaped investor expectations. Markets interpreted these trade policy shifts as manageable and potentially stimulative to domestic production in the medium term. |
Tariffs Imports Trade Policy Domestic | |
RatesFederal Reserve maintained benchmark interest rate unchanged at 5.25% to 5.50%, with Chair Powell emphasizing the need for greater confidence that inflation is moving sustainably toward 2% before considering rate cuts. The Fed remains data-dependent on future policy moves. |
Fed Interest Powell Monetary Policy |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| No Elevator Pitches found | ||||||||||
| TICKER | COMMENTARY |
|---|---|
| ^GSPC | The S&P 500 still had a strong quarter, returning 10.2% (GBP), but returns in several other regions were even stronger. Given the strong Q3 returns of the S&P 500, U.S. price-to-earnings multiples are reaching historically high levels, with the cyclically adjusted PE ratio at levels not seen since the dot-com bubble. Despite a good quarter of S&P 500 performance, the theme of fading U.S. dominance has continued to build this quarter. With the S&P 500 reaching new all time highs, valuations once again appear stretched. |
| ^HSI | The Hang Seng returned 15.5% (GBP), both of which Carrington portfolios are heavily overweight in. Chinese equities were the standout performers over the quarter, supported by renewed confidence in the domestic economy. |
| GLD | Gold returned 17.1% (GBP), both of which Carrington portfolios are heavily overweight in. Gold remains an overweight position despite some profit-taking in Q2. It continues to climb higher due to rising long-term inflation expectations, falling interest rates, and ongoing geopolitical uncertainty. |
| ^FTSE | Despite this, the UK stock market has had a good quarter. It enjoyed an exceptionally strong Q2 before cooling slightly, but the FTSE 100 still ended the quarter up 7%. Year to date, the FTSE 100 has returned 19% compared to the S&P 500's 6% (GBP). |
| BTC-USD | Meanwhile, asset prices continue to climb, the S&P 500, U.S. house prices, Bitcoin, gold, money supply, and national debt have all reached new all-time highs. In the UK, the FCA has finally approved that Bitcoin can be held by individual investors, marking an important development in the evolution of the digital asset landscape. |
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