Ocado Group PLC (OCDDY) is our worst performing (in price terms) position so far this year. However, even while Ocado’s stock has fallen, our conviction that the underlying business continues to create real shareholder value has only increased. As a result, we recently increased our position at these lower price levels. As a brief reminder,...
Dear Partners, Our performance in the first half of 2022 was disappointing in many respects. The S&P 500 had its worst start to the year in over 50 years. Bonds fared no better, with the 10-year treasury reaching its highest yield since 2011. To put this into context, below is a chart of intra-year peak to...
In our previous article, we made the case for why active management still makes sense in a passive-orientated world. After all, if you want better than average returns, then you must be different from the average, which means taking an active approach. But how do you know which active fund to pick? How can you...
What drives stock prices? At times like this, this question is crucial for investors to understand. The answer is that when you really get down to it, stock prices are really determined by only two things: Fundamentals of a business – Earnings per share, cash flow, return on invested capital, etc. Sentiment – How much the...
Barrons: Why the S&P 500 Is Missing the (Bench)Mark Investors need to understand the hidden risks they are taking by investing passively, given how flawed many indices are. And on top of that, we need to make everyone aware that so much market commentary (even from 'respectable' firms) is plain nonsense. Comparison of index valuation...
There are two important considerations for today’s market environment. One (which we wrote about in our last post) is having the economic strength to take advantage of market volatility rather than being beholden to the capital markets. The second consideration has to do with inflation and pricing power. The best hedge against rising inflation isn’t...
Back in August, we wrote about how standard accounting treatment of stock-based compensation can mislead investors about the true economics of a business. As a brief recap– companies often issue stock to employees as part of their compensation. This has become quite popular in tech- land over the past 5 years as two things have...
We believe that a low-cost, passive investing strategy such as an S&P 500 index fund has a place in our industry – after all, for most retail investors who cannot invest the time, nor have the expertise, or the experience, then investing in a highly diversified ‘market’ portfolio is probably the best course of...
Dear Partners, Our GCI Select Equity composite ended the quarter -10.69% gross of fees. For context, the S&P 500 ended the quarter -4.60: Individual account performance may differ based on asset mix and timing of investments. Underperforming the market is never welcome, but over such a short period of time is of little consequence. We at GCI...
The war in Ukraine is creating serious human hardship and suffering not only in the region but around the world. And despite where your politics may land, we can probably all agree that a stock market sell-off is much less of a worry than what many people in Ukraine are currently dealing with. Without diminishing...
