Communications

That being said, the beauty, if not the benefit, of active management is that it is fortunately possible to remain underweight in certain asset classes. In addition, even when markets are stagnating, there are still opportunities in specific sectors.

The first half of 2023 has now ended, and the market is still looking for a clear direction. With the exception of less than a dozen technology large caps, negative trends for North American stock markets have stabilized over the first six months of the year.

In this bulletin, I will begin by discussing the current state of the markets and interest rate levels. I will continue with a few words about the insurance needs of some investors and wrap up, as usual, with our market outlook and top positions.

This financial letter is in its 14th year and I want to thank all of you for your loyalty and interest in reading it. We are fortunate to have you as our clients and we are entering 2023 with enthusiasm and a number of interesting investment ideas.

The three months ended on September 30, like the previous two quarters, gave investors a rough ride. A number of macroeconomic factors were aligned, including inflation that was higher and more persistent than the major central banks had anticipated.

Rarely has the first half of a year been so difficult in the markets. In fact, we have to go back 50 years, to 1970, when the S&P 500 lost 21% of its value in six months. The good news? The index rose 26.5% between July and December of that year.

That is a real conversation I had recently. I have been saying since the launch of Rivemont that it’s not when everything is going well and your brother-in-law’s niece’s neighbour’s sister obtains excellent returns that it’s possible to judge a manager’s skills, but rather when times are more difficult and opportunities are less obvious to the average person.

Despite the pandemic’s major inconveniences, Rivemont maintained its rapid growth of recent years, and we now have close to $100 million in assets under management. I would like to take this opportunity to thank everyone who rolled up their sleeves to tackle the challenges that arose.