×
×
×
×
×

Tell us once and we'll remember.

I'm an...

Don't worry, you can always change this selection using the icons at the top left of the site.

One of the things our process is designed to identify is unsustainable extremes we can exploit, particularly when investor behavior prices either too much optimism or pessimism into equity valuations. Right now, the market continues to confidently price in a soft economic landing and the continued dominance of U.S. mega cap growth stocks. We believe this zealous optimism has overshadowed the growing risks posed by a dangerous combination of rising equity multiples and increasing interest rates.

Today we have anything but a uniformly priced market. It is bearish for U.S. indexes, while providing a great opportunity to look for mispriced stocks with strong fundamentals beyond the concentrated top of those indexes. The value of value relative to growth is back to historic highs, being driven by the extreme concentration of the top seven stocks in the S&P 500 Index (Exhibit 1). Never has so much liquidity been sucked into so few stocks, and the risk may prove a black hole for capital and weigh on returns due to increased volatility from higher correlations. continue...

Insights for Informed Investments

Subscribe Now!

Let's Connect...

Want to learn more? : Email Us
or

Related Perspectives

Value Strategy 4Q25 Update
Portfolio Manager Sam Peters discusses the drivers of portfolio performance in the fourth quarter, recent buys and sells and why positioning for many possible futures is important in a market priced for a narrow set of outcomes.
Dividend Strategy 4Q25 Update
Portfolio Manager Mike Clarfeld breaks down portfolio performance in the fourth quarter, discusses his approach to diversification in a concentrated market and gives his outlook for dividend stocks in 2026.
International Growth EAFE Strategy 4Q25 Update
PM Michael Testorf highlights how the Strategy is navigating a value-dominated international equity market and what to look for in 2026.
Large Cap Growth Strategy 4Q25 Update
Portfolio Manager Margaret Vitrano highlights performance and positioning activity for the quarter and full year amid a momentum driven growth market.
2026 Infrastructure Market Outlook
We expect fiscal liquidity and dovish central bank policy in 2026 to pressure bond yields, which should support utilities and also drive growth on GDP-sensitive user-pays infrastructure.
MORE