| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | - | - |
Q1 2026 was marked by significant volatility as the Iran conflict drove oil prices toward $120 per barrel, reigniting inflation concerns and triggering market selloffs before stocks rebounded to new highs by quarter-end. The S&P 500 declined 4.33% for the quarter despite the late rally. The conflict shifted investor focus from AI beneficiaries to companies potentially disrupted by AI, causing rotations out of growth stocks into value, small-cap, and alternative assets. Core PCE inflation accelerated to 3.1% before the energy shock, reinforcing concerns about a higher inflation regime. The US economy entered the quarter with strong fundamentals including healthy corporate balance sheets, ongoing AI infrastructure investment of $600bn, and reduced energy dependence compared to the 1970s. However, the combination of geopolitical uncertainty, inflation pressures, and Federal Reserve policy delays prompted a more cautious risk posture. Traditional bond diversification may prove less reliable in this environment, favoring shorter-duration fixed income strategies.
Despite Q1 volatility from the Iran conflict and oil price surge, the US economy entered the period in solid shape with healthy corporate balance sheets and AI investment momentum, though higher inflation risks warrant a more cautious positioning.
While valuations improved somewhat during the quarter, risks also increased, prompting a more cautious overall risk posture. The manager continues to monitor valuation, inflation, interest-rate trends, and market breadth. Sticky inflation remains the primary risk if disruption endures.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Apr 27 2026 | 2026 Q1 | - | AI, energy, Geopolitical, inflation, Iran, oil, value | - | Iran conflict volatility drove Q1 selloff despite strong economic fundamentals and AI investment momentum. Oil surge to $120 reignited inflation fears, causing rotation from growth to value stocks. While US energy independence provides some insulation from 1970s-style stagflation, persistent inflation risks and geopolitical uncertainty warrant more cautious positioning and shorter-duration bond strategies. |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2026 Q1 |
OilOil prices surged toward $120 per barrel due to Iran conflict fears before easing back near $100. Higher energy costs renewed inflationary pressures and created uncertainty for corporate costs, consumer spending, and Federal Reserve policy. The US energy landscape today makes the country less vulnerable to stagflationary shocks compared to the 1970s. |
Energy Geopolitical Inflation Supply OPEC |
AIThe AI boom continued with focus shifting to companies that could be hurt by AI disruption. This led to a rolling selloff across software, trucking, commercial real estate, and financial data sectors. The AI buildout remains a primary growth engine with hyper-scaler capital investment projected over $600bn or 2% of GDP. |
Technology Disruption Infrastructure Investment | |
InflationCore PCE inflation edged up to 3.1% in January, the fastest pace in nearly 2 years, before the Iran conflict lifted energy and input costs further. The manager sees risks of being in a higher inflation regime with greater volatility, which has implications for traditional portfolio construction and bond diversification potential. |
Monetary Policy Fed Rates Bonds | |
ValueValue stocks outperformed growth across all market caps during the quarter. The MSCI ACWI ex USA Value Index outpaced the Growth Index by almost six percentage points, driven primarily by higher exposure to the Energy sector. Q1 sector leadership reflected a rotation toward Value and inflation beneficiaries. |
Style Rotation Outperformance Energy |
| 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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| No Recent Buys Data | |||||
| Ticker | Put/Call | Amount Sold | Shares Sold | % Change | Weight % | Status |
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| No Recent Sells Data | ||||||
| Industry | Prev Quarter % | Current Quarter % | Change |
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| No industry data available | |||
