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January Newsletter

What happened:

  • 2021 started off very much like 2020 ended, with some volatility and growth continuing to lead the US broad markets.  However, it was US small cap stocks and emerging markets which outperformed all asset classes.
  • January had some other very notable and almost unbelievable events including the storming of Capital Hill in the US capital of Washington D.C. and the infamous Reddit following of  WallStreetBets taking down some hedge funds with an incredible short squeeze on GME.

What we did:

  • In spite of the short lived political and financial rebellions, the market did not really react to any of it and neither did we.  If anything our exposure to global markets and emerging markets in a core equity portfolios seemed ever more justified. We continue to hold IEMG, VGK, KWEB and VPL. 
  • As for our growth strategy, we trimmed our allocation to stocks APPN, BX and NFLX after they all saw substantial gains and moved towards the top end of our current valuation. We continue to hold each stock, just at a lower allocation in the portfolio. We also added some growth at a reasonable price in Mastercard (MA). 

What we are watching:

  • The next round of stimulus in the US is still a major focus as $1.9 Trillion seems to be package being pushing through by Biden and his new administration.  
  • Other policies and changes the new administration may have in store is also a concern, as an increase in taxes to both Corporations and Individuals seems eminent, along with inflation. The questions  for both is just when?
  • Last but not least, we continue to keep an eye on the COVID-19 vaccination numbers as well as economic recovery from the devastating shutdowns. 

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