Quarterly CIO Letter: Third Quarter 2022
The third quarter was quite a ride, adding to a painful year for investors. The market was strong in July and the beginning of August on a misreading of Federal Reserve Chairman Jerome Powell’s remarks. Investors were hoping for a Fed pivot, and were beginning to price it in. We saw it as a head fake and took advantage of the strength to take risk off the table. In mid-August the market started selling off as Powell confirmed at Jackson Hole that his stance remained decidedly hawkish and the Fed was committed to continuing to fight inflation.
Dynamically Navigating the Changing Currents
Our investment process was built to navigate the twists, turns, and surprises of a more volatile investment landscape. The world has fundamentally changed. The long economic cycles of the past are just that, a thing of the past. Going forward we believe cycles will be more muted and shorter. In this new environment, being dynamic, diversified, disciplined, focused on risk and armed with a broader set of tools will be imperative.