How Losing an Eye Helped Charlie Munger See Success + New interviews with Robert Wilson, and Dino Bourdos!

What happened this week?

• Global Valuations: A Rubber Band Poised to Snap - Valuation alone may not be a reliable short-term timing indicator, but crowded and overvalued markets have a greater risk of disappointment. Today, investors are generally ignoring global stocks and have increasingly crowded into a handful of very expensive US stocks. Because valuation is a prime determinant of long-term returns, these ignored market segments stand to benefit as sentiment begins to normalize.
• Is the "Buy the Dip" Era Over? - 2023 may not be over yet, but with only a few weeks left, it appears to have been a great year to be an investor. Global equities are up about 15%, led by the S&P and Europe at +20%, followed by Japan at +13% and the TSX at +7%.
• How High for How Long? - The anticipated end to the rate-hiking cycle of the past two years could be an important tailwind for financial markets in 2024. But how much of a boost it gives may largely depend on the economic backdrop that unfolds – and how low central banks are willing to go if they do start cutting rates.
• The Markets Are Front Running the First Rate Cut - Interestingly, a Wall Street axiom says, “Sell the last Fed rate hike.” The reason is that when the Fed starts cutting rates, it is due to the onset of a recession, a bear market, or a financial event. At that point, as shown below, the markets are repricing for lower expectations of earnings growth rates and profitability.
• How Losing an Eye Helped Charlie Munger See Success - The life story of Charlie Munger, who passed away last week at age 99, serves as a shining example of the enduring American Dream, especially now at a time when many people doubt whether the promise of a better life is still intact. On the contrary, I believe that Munger’s journey, coupled with data from the updated Forbes 400 list, reaffirms that the American Dream still thrives.

Top Performing

1. Century Aluminum Company ▲26.52%
2. Alcoa Corp ▲26.18%
3. Gannett Co Inc ▲21.17%
4. Organon and Co ▲19.96%
5. Big Lots Inc ▲16.94%

Bottom Performing

1. Oracle Corporation ▼-10.06%
2. Sea Limited ▼-8.18%
3. Exelon Corporation ▼-8.07%
4. Cardinal Health Inc ▼-7.83%
5. Arch Capital Group Ltd ▼-7.40%

NEW INTERVIEWS: The Insight is Capital? Podcast

In this episode, Robert Wilson, CFA, CAIA, MBA, Senior Vice President, and Head of Portfolio Construction Consultation Service at Picton Mahoney Asset Management discusses the BARBELL approach to portfolio construction – seven key concepts for unlocking portfolio resilience and return potential to help navigate a challenging market backdrop.

In this insightful discussion, Dino Bourdos, Portfolio Manager & Head of Investment Solutions at Guardian Capital Group delves into the intricacies of investment strategies, particularly focusing on the use of derivatives, covered call strategies, and the impact of market dynamics on investment decisions. With his extensive experience in the field, Bourdos offers valuable insights into the challenges and opportunities in the current economic landscape, making this a must-watch for investors and financial professionals alike.

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