The sudden failure of Silicon Valley Bank in March jostled investors' confidence in the market. But, the overall performance of various tech stocks in Q1, such as Tesla, Meta, Alphabet, Amazon, Salesforce, AMD, and Broadcom, served to revive optimism for the stock market's near future. Join Casey Dylan, CIMA®, Consultant, and our host Tom Romano, Head of Strategic Relationships and Product Development, in this first half of of our Q1 recap, as we discuss both market, and factor performance, in the first few months of 2023. If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/ You can also find us on Facebook, YouTube, Twitter, and LinkedIn. As always, we remain invested in your goals. Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions.   Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice.   Transcript: 0 00:00:01.900 --> 00:00:07.400 Good afternoon, 1 00:00:07.400 --> 00:00:10.700  everyone. This is Tom Romano head of strategic relationships at 2 00:00:10.700 --> 00:00:14.200  symmetry partners and joined with me. Today is Casey Dillon 3 00:00:13.200 --> 00:00:16.900  a long time friend of symmetry and our 4 00:00:16.900 --> 00:00:19.500  internal communication strategist. Thank you Casey for 5 00:00:19.500 --> 00:00:22.400  joining us today. Tom is excellent to be here with you live in 6 00:00:22.400 --> 00:00:25.100  person. Yeah, fantastic. Fantastic So today, we're gonna go 7 00:00:25.100 --> 00:00:28.900  through our q1 2023 quarter in 8 00:00:28.900 --> 00:00:31.700  perspective. It's been quite the 9 00:00:31.700 --> 00:00:34.800  interesting quarter to say the least we've had 10 00:00:34.800 --> 00:00:37.800  some volatile markets. Although 11 00:00:37.800 --> 00:00:40.400  I'll be at some positive results. We've seen things 12 00:00:40.400 --> 00:00:43.300  like banking collapses in the headlines. There's still of 13 00:00:43.300 --> 00:00:46.600  course the concerns about inflation. And so 14 00:00:46.600 --> 00:00:49.800  Casey thank you for joining us to give us some perspective 15 00:00:49.800 --> 00:00:52.300  of what's going on in the market. So in a 16 00:00:52.300 --> 00:00:55.800  nutshell what happened in q1 of 2023, yeah 17 00:00:55.800 --> 00:00:58.300  in a nutshell, I'll be brief if I 18 00:00:58.300 --> 00:01:00.500  can so if you recall 19 00:01:01.800 --> 00:01:04.300 The fourth quarter of last year, right? The 20 00:01:04.300 --> 00:01:07.600  last year was a brutal year across a number of metrics, but 21 00:01:07.600 --> 00:01:10.500  the fourth quarter we started to see some respite 22 00:01:10.500 --> 00:01:13.300  from that and the first two months of the fourth quarter, 23 00:01:13.300 --> 00:01:16.600  right? We saw markets actually rebound pretty 24 00:01:16.600 --> 00:01:19.500  significantly in October and November and much of 25 00:01:19.500 --> 00:01:23.000  that was driven by the sense across 26 00:01:22.700 --> 00:01:25.900  the markets Market participants that maybe 27 00:01:25.900 --> 00:01:28.500  the Fed was done raising interest rates, maybe 28 00:01:28.500 --> 00:01:31.400  that the inflationary pressures that 29 00:01:31.400 --> 00:01:34.700  we had seen in the spring of 2022. We're 30 00:01:34.700 --> 00:01:37.400  starting to Abate and the market is 31 00:01:37.400 --> 00:01:40.800  a forward-looking forward pricing mechanism. And so 32 00:01:42.200 --> 00:01:45.200 In the fourth quarter, that's what it did. It looked forward. 33 00:01:45.200 --> 00:01:48.700  It started to anticipate a period when the the 34 00:01:48.700 --> 00:01:51.300  Fed was not raising interest rates and inflation would be tamed. 35 00:01:51.300 --> 00:01:55.100  And of course what happened in December was 36 00:01:54.100 --> 00:01:57.800  a bit of a comeuppance for 37 00:01:57.800 --> 00:02:00.400  those Market participants who got a little bit ahead of 38 00:02:00.400 --> 00:02:03.500  the fed and we saw a pullback in 39 00:02:03.500 --> 00:02:03.700  December. 40 00:02:04.400 --> 00:02:07.600 And markets responding to the fact that the FED said well, no, 41 00:02:07.600 --> 00:02:10.500  we're pretty set on continuing to raise rates. 42 00:02:10.500 --> 00:02:12.800  And and we think we're gonna keep them higher longer. 43 00:02:13.700 --> 00:02:16.500 As we rolled into the first quarter of this year. We saw 44 00:02:16.500 --> 00:02:19.900  a replay of a lot of those Dynamics coming into 45 00:02:19.900 --> 00:02:23.000  January Market participants 46 00:02:22.300 --> 00:02:24.000  again. It's sort of 47 00:02:25.400 --> 00:02:28.200 Determined that this was the year the Fed was 48 00:02:28.200 --> 00:02:31.100  going to stop rate and Market participants started to 49 00:02:31.100 --> 00:02:34.200  look forward and price as if the not only 50 00:02:34.200 --> 00:02:37.600  with the FED stop racing rates, but they would start to pull rates 51 00:02:37.600 --> 00:02:42.400  back by the end of the year given where people 52 00:02:41.400 --> 00:02:45.300  reading the tea leaves assumed the 53 00:02:45.300 --> 00:02:47.500  economy would be by mid-year. 54 00:02:48.200 --> 00:02:51.800 And so you saw a really robust Rebound in 55 00:02:51.800 --> 00:02:54.000  January for a lot of the names that have been 56 00:02:54.200 --> 00:02:57.900  really beat up in 2022 specifically the 57 00:02:57.900 --> 00:03:01.000  large cab growth and Tech names and 58 00:03:00.300 --> 00:03:03.200  so there was something of a reversion to 59 00:03:03.200 --> 00:03:06.300  the mean in terms of those names really 60 00:03:06.300 --> 00:03:09.500  leading the charge in January. Those are 61 00:03:09.500 --> 00:03:12.200  the names that were most beaten up in 2022. Those are the 62 00:03:12.200 --> 00:03:15.500  names that snap back fastest in the 63 00:03:15.500 --> 00:03:18.500  first quarter. And so January where we 64 00:03:18.500 --> 00:03:22.900  saw for instance the S&P down 20% for 65 00:03:22.900 --> 00:03:25.200  2022. We saw 66 00:03:25.200 --> 00:03:28.100  a Resurgence just in the month of January the SP was up 67 00:03:28.100 --> 00:03:31.400  like eight percent and the NASDAQ double that right just on the 68 00:03:31.400 --> 00:03:34.400  strength of kind of those large cap Tech names and of course what happened 69 00:03:34.400 --> 00:03:38.100  as we rolled into February the news that 70 00:03:37.100 --> 00:03:40.400  came out on the sort of 71 00:03:40.400 --> 00:03:43.400  economic underpinnings specifically job data for 72 00:03:43.400 --> 00:03:47.100  January really surprised Market 73 00:03:46.100 --> 00:03:48.100  participants because 74 00:03:48.200 --> 00:03:52.400 It was so robust. So strong it exceeded expectations. It 75 00:03:51.400 --> 00:03:54.800  served as a really Stark reminder that we're 76 00:03:54.800 --> 00:03:55.500  not out of the woods yet. 77 00:03:56.200 --> 00:03:59.500 And and it sent shock waves 78 00:03:59.500 --> 00:04:02.400  across the market in the sense that everyone who 79 00:04:02.400 --> 00:04:06.000  had said. Okay. Well now the FED is gonna have to wind this down all 80 00:04:05.200 --> 00:04:08.400  the sudden the the realized maybe not 81 00:04:08.400 --> 00:04:11.400  right not only is the fed maybe not gonna wind this 82 00:04:11.400 --> 00:04:14.700  down because the economy is hotter than we thought it was but we potentially 83 00:04:14.700 --> 00:04:17.600  risk sort of a flare-up of inflation 84 00:04:17.600 --> 00:04:20.100  just as it was coming down and the FED may have 85 00:04:20.100 --> 00:04:23.500  to get more aggressive in in tackling that and 86 00:04:23.500 --> 00:04:27.000  so February saw sort of a revisitation of 87 00:04:26.400 --> 00:04:29.500  those expectations that market participants 88 00:04:29.500 --> 00:04:33.100  had and as we rolled into March then all 89 00:04:32.100 --> 00:04:35.800  eyes were on the Senate 90 00:04:35.800 --> 00:04:38.700  hearings with the the chairman 91 00:04:38.700 --> 00:04:41.200  of the fed and based on his 92 00:04:41.200 --> 00:04:44.700  comments Futures skyrocketed for an expectation 93 00:04:44.700 --> 00:04:47.200  of a 50 basis point raise at 94 00:04:47.200 --> 00:04:50.500  the end of March the Futures went up to like a 70% chance that 95 00:04:50.500 --> 00:04:53.300  the Fed was gonna raise 50 basis points, and 96 00:04:53.300 --> 00:04:55.500  of course what happened then you know days later. 97 00:04:56.100 --> 00:05:00.000 Started imploding right and that sort 98 00:04:59.100 --> 00:05:03.000  of Royal financial markets and 99 00:05:02.500 --> 00:05:05.200  the FED did end up raising rates. But 100 00:05:05.200 --> 00:05:08.200  only by 25 basis points after they had worked to 101 00:05:08.200 --> 00:05:11.200  sort of rescue. I don't know rescues the 102 00:05:11.200 --> 00:05:15.500  right term but step in aggressively and calm markets 103 00:05:14.500 --> 00:05:17.200  particularly folks who 104 00:05:17.200 --> 00:05:20.600  had cash on deposited Banks to keep sort 105 00:05:20.600 --> 00:05:23.200  of a contagion effect and a larger Bank Run taking place. 106 00:05:23.200 --> 00:05:26.800  Right? So we end the first quarter with a really 107 00:05:26.800 --> 00:05:29.900  sort of wild trip of markets shooting 108 00:05:29.900 --> 00:05:32.500  up coming back down a lot of volatility a lot 109 00:05:32.500 --> 00:05:35.400  of fear injected in markets in March with the 110 00:05:35.400 --> 00:05:38.300  headlines and yet at the end of the quarter you finished up 111 00:05:38.300 --> 00:05:41.900  pretty again pretty solidly across 112 00:05:41.900 --> 00:05:45.000  us markets International Development markets emerging 113 00:05:44.400 --> 00:05:47.700  markets in fixed income inequities, right? 114 00:05:47.700 --> 00:05:50.400  We it was a it was a pretty decent first 115 00:05:50.400 --> 00:05:53.800  quarter from a return perspective despite all of that. Yeah sure. 116 00:05:53.800 --> 00:05:56.000  It was like it's a very interesting quarter. 117 00:05:56.100 --> 00:05:59.200 And I'd like the way you put it on the things the kind of the Resurgence of 118 00:05:59.200 --> 00:06:03.100  these tech companies that didn't have a great year last year, but you're 119 00:06:02.100 --> 00:06:05.500  seeing asset classes such as the energy 120 00:06:05.500 --> 00:06:08.600  sector right who had a great year last year is to 121 00:06:08.600 --> 00:06:11.300  use your your term of aversion to the mean right? They had 122 00:06:11.300 --> 00:06:14.500  a tough time in the first quarter, right? Yeah. Yeah and and frankly 123 00:06:14.500 --> 00:06:18.200  prices have been coming down in oil and gas pretty 124 00:06:17.200 --> 00:06:18.800  consistently. 125 00:06:19.200 --> 00:06:22.800 Since last fall so we did see a continuation of that. I 126 00:06:22.800 --> 00:06:27.300  do think and likely there's 127 00:06:26.300 --> 00:06:29.200  more conversation to be had 128 00:06:29.200 --> 00:06:32.900  around this but the concern that I have or 129 00:06:32.900 --> 00:06:35.500  or would have based on 130 00:06:35.500 --> 00:06:38.600  how markets performed in the first quarter is that 131 00:06:38.600 --> 00:06:41.900  it was so dominated by a 132 00:06:41.900 --> 00:06:44.100  handful of names, right? We we've seen 133 00:06:44.100 --> 00:06:47.300  this Dynamic before where we're 134 00:06:47.300 --> 00:06:51.000  sort of the top largest growth Tech 135 00:06:50.300 --> 00:06:53.800  names sort of dominate performance 136 00:06:53.800 --> 00:06:56.500  of the market and we and we saw that again in 137 00:06:56.500 --> 00:07:01.500  the first quarter right? You think about Facebook alphabet 138 00:07:00.500 --> 00:07:04.700  Apple Google Netflix, right? 139 00:07:03.700 --> 00:07:06.500  All of those firms were 140 00:07:06.500 --> 00:07:09.500  really been challenged in 2022 had a 141 00:07:09.500 --> 00:07:12.300  nice Resurgence across the first quarter, but when 142 00:07:12.300 --> 00:07:16.000  you dig deeper into the performance particularly here domestically what 143 00:07:15.200 --> 00:07:18.900  you see is they were the lion 144 00:07:19.100 --> 00:07:22.400 Care of that return that we saw the market it was once again 145 00:07:22.400 --> 00:07:27.100  the fact that these top handful of names represent twenty 146 00:07:25.100 --> 00:07:28.600  plus percent of the overall 147 00:07:28.600 --> 00:07:32.000  market, right? So think S&P 500 has got ostensibly 500 148 00:07:31.500 --> 00:07:34.700  names in it the top 10 names 149 00:07:34.700 --> 00:07:38.000  accounted for all at 150 00:07:37.100 --> 00:07:40.400  least 80% of that return right the 151 00:07:40.400 --> 00:07:43.300  top top five names half of it, right? So so 152 00:07:43.300 --> 00:07:46.400  again, you're getting a lot of that return concentrated in 153 00:07:46.400 --> 00:07:47.000  these names. 154 00:07:47.900 --> 00:07:51.600 Because they're so large disproportionately to 155 00:07:50.600 --> 00:07:55.200  the other names in those indices 156 00:07:54.200 --> 00:07:57.300  and it lit. It's the rising tide lifting 157 00:07:57.300 --> 00:08:00.200  all boats, but the concern that you 158 00:08:00.200 --> 00:08:03.100  have with that and we saw that in 2022 when the 159 00:08:03.100 --> 00:08:06.600  air goes out of the balloon to a degree. Well that 160 00:08:06.600 --> 00:08:09.500  can be a double-edged sword. Right if those names start 161 00:08:09.500 --> 00:08:13.000  to pull back in valuations, you 162 00:08:12.300 --> 00:08:15.400  could see that turn around and become an anchor pulling 163 00:08:15.400 --> 00:08:19.000  markets down, right and that can happen very quickly just based 164 00:08:18.100 --> 00:08:21.600  on the fact that it's so concentrated in a 165 00:08:21.600 --> 00:08:24.000  handful of names that are all sort of in the 166 00:08:24.300 --> 00:08:27.100  same kind of economic Waters right in terms of kind of 167 00:08:27.100 --> 00:08:30.600  this large growth Tech, you know richly valued. 168 00:08:30.600 --> 00:08:33.100  Yeah. It sounds a lot like me, you know, I've 169 00:08:33.100 --> 00:08:37.200  had these conversations over the years even going back before 2022 170 00:08:36.200 --> 00:08:39.700  coming out of the pandemic 171 00:08:39.700 --> 00:08:42.300  and those tech stocks. They were the story they were leading 172 00:08:42.300 --> 00:08:45.400  the charge and what I'm hearing you say, is that sort 173 00:08:45.400 --> 00:08:47.800  of the casing q1, but that double-ed 174 00:08:47.800 --> 00:08:50.700 word is just going back 2022 would 175 00:08:50.700 --> 00:08:53.700  be an example of if you're not well Diversified 176 00:08:53.700 --> 00:08:56.800  that could be a painful experience it can and I'm 177 00:08:56.800 --> 00:08:57.900  I'm reminded of 178 00:08:59.300 --> 00:09:02.400 The experience that we had coming out of the tech bubble, 179 00:09:02.400 --> 00:09:05.300  right? So if you think about if in fact 180 00:09:05.300 --> 00:09:08.300  the run-up invaluations in this sort of handful of 181 00:09:08.300 --> 00:09:11.400  techniques is analogous to what we saw in 182 00:09:11.400 --> 00:09:12.000  the late 90s. 183 00:09:14.200 --> 00:09:17.300 They were so richly valued that when the 184 00:09:17.300 --> 00:09:20.600  tech Bubble Burst it took a decade the Lost 185 00:09:20.600 --> 00:09:24.200  decade right of just you know, subpar returns 186 00:09:23.200 --> 00:09:26.300  for the valuations to get 187 00:09:26.300 --> 00:09:29.500  back to a place where markets could then start 188 00:09:29.500 --> 00:09:32.400  to take off again. And so the concern that 189 00:09:32.400 --> 00:09:36.200  that one might have is valuations are 190 00:09:35.200 --> 00:09:40.400  still Rich, right? Even after 2022 on 191 00:09:39.400 --> 00:09:43.200  a Price to Book basis very 192 00:09:42.200 --> 00:09:45.600  expensive on a price to 193 00:09:45.600 --> 00:09:50.500  forward earnings basis. It's expensive and 194 00:09:48.500 --> 00:09:51.600  so it's not 195 00:09:51.600 --> 00:09:54.600  as if these are our Bargains to 196 00:09:54.600 --> 00:09:57.800  be had in a Marketplace that that's discounting 197 00:09:57.800 --> 00:10:00.700  them. They are still incredibly expensive. And so 198 00:10:00.700 --> 00:10:03.400  anything that goes wrong right if the 199 00:10:03.400 --> 00:10:06.300  if in fact the economy runs into turbulence at 200 00:10:06.300 --> 00:10:09.700  some point or the expectations for growth, I mean, 201 00:10:09.700 --> 00:10:12.600  you know, we're in earning season and Netflix had sort 202 00:10:12.600 --> 00:10:14.100  of positive numbers, but 203 00:10:14.100 --> 00:10:17.700 They sort of gave lackluster guidance for next quarters 204 00:10:17.700 --> 00:10:20.400  growth. Right? So all you need is for for Market 205 00:10:20.400 --> 00:10:23.400  participants to to a once again sour on the 206 00:10:23.400 --> 00:10:27.400  prospects of these names and you're right back to it's 207 00:10:26.400 --> 00:10:29.300  too too rich like I'm paying 208 00:10:29.300 --> 00:10:32.500  too much today for for earnings in 209 00:10:32.500 --> 00:10:35.100  the future that may or may not materialize right? And so 210 00:10:35.100 --> 00:10:38.700  I've got to pay less and so the price has to come down. Yeah, right. And 211 00:10:38.700 --> 00:10:41.300  again, I'm not suggesting that we have a lost decade 212 00:10:41.300 --> 00:10:44.200  in front of us, but this potentially room to run 213 00:10:44.200 --> 00:10:48.300  if markets turn and I think that's the the concern that 214 00:10:47.300 --> 00:10:50.100  I would share with investors. That's what I 215 00:10:50.100 --> 00:10:53.500  prepare them for. Hey, we'll take what we get. Right? We're happy 216 00:10:53.500 --> 00:10:54.700  to get those returns, but 217 00:10:56.200 --> 00:10:59.500 This could still be valve this this, you know, we're in the third inning potentially 218 00:10:59.500 --> 00:11:02.900  look or fourth ending. There's a lot of game left and we're 219 00:11:02.900 --> 00:11:05.000  just gonna buckle up and be ready for it. Yeah, and what is 220 00:11:05.300 --> 00:11:09.200  interesting what this quarter and you detect upon that I'd love to get your thoughts developed International 221 00:11:08.200 --> 00:11:11.300  to having a very good quarter. 222 00:11:11.300 --> 00:11:14.400  I mean when we saw these large Tech 223 00:11:14.400 --> 00:11:17.600  names and in the past when they had their run prior to 2022, it 224 00:11:17.600 --> 00:11:20.600  was a pretty much us dominated run up. 225 00:11:21.800 --> 00:11:24.500 Give us some commentary on what we're saying in the developed International 226 00:11:24.500 --> 00:11:27.100  Space. Yeah, I think some of 227 00:11:27.100 --> 00:11:31.600  it is the Resurgence of the 228 00:11:32.900 --> 00:11:35.700 strength of the sort 229 00:11:35.700 --> 00:11:38.200  of the the companies that are there that have 230 00:11:38.200 --> 00:11:42.000  sort of suffered through a decade of kind of sub-par performance 231 00:11:41.300 --> 00:11:45.400  and they were in a much stronger financial 232 00:11:44.400 --> 00:11:47.300  position. Then they 233 00:11:47.300 --> 00:11:51.300  were for instance going into the global financial crisis, right and they 234 00:11:50.300 --> 00:11:53.700  weren't super expensive. Right? 235 00:11:53.700 --> 00:11:58.100  So from a perspective of they were kind of relatively cheaply 236 00:11:56.100 --> 00:11:59.100  priced compared to 237 00:11:59.100 --> 00:12:02.500  US stocks. And so if we look at just the performance 238 00:12:02.500 --> 00:12:06.100  the they don't have to have that much right 239 00:12:05.100 --> 00:12:09.300  surprise upside. 240 00:12:10.300 --> 00:12:14.300 To have nice performance right across the board or 241 00:12:13.300 --> 00:12:16.200  relatively decent performs. 242 00:12:16.700 --> 00:12:19.800 So I think people were pleasantly surprised by 243 00:12:19.800 --> 00:12:23.500  some of the financial resilience in 244 00:12:22.500 --> 00:12:25.200  Europe particularly coming out of 245 00:12:25.200 --> 00:12:28.900  the effects of the the Russian Ukraine 246 00:12:28.900 --> 00:12:31.600  conflict and looking at the impact that 247 00:12:31.600 --> 00:12:34.500  for instance the the price of gas price 248 00:12:34.500 --> 00:12:37.100  of oil I had in places like Germany and the fact 249 00:12:37.100 --> 00:12:40.300  that they sort of got through that not unscathed but 250 00:12:40.300 --> 00:12:43.700  you know, the the avoided the apocalypse 251 00:12:43.700 --> 00:12:47.000  right the gasoline apocalypse over the course of the 252 00:12:46.600 --> 00:12:49.300  winter right that it was relatively mild. So 253 00:12:49.300 --> 00:12:52.600  I think that from that perspective markets sort 254 00:12:52.600 --> 00:12:55.600  of said rewarded International developed 255 00:12:55.600 --> 00:12:58.900  businesses with valuations that 256 00:12:58.900 --> 00:13:01.400  seemed a little more reasonable than the 257 00:13:01.400 --> 00:13:04.000  valuations in the US. Yeah, that makes a lot of sense and thank you 258 00:13:04.200 --> 00:13:07.900  for that. Yeah, and and I would call I would suggest that 259 00:13:07.900 --> 00:13:10.200  Emerging Markets are in a similar but 260 00:13:10.200 --> 00:13:14.300  different position right again a little more financially 261 00:13:13.300 --> 00:13:16.300  robust in terms of the underpinnings. 262 00:13:17.300 --> 00:13:20.100 Of those companies relative to where we've seen Cycles where people 263 00:13:20.100 --> 00:13:23.100  are risk off and and sort of beating down 264 00:13:23.100 --> 00:13:26.200  in price. I think anytime you have a lot of volatility people are 265 00:13:26.200 --> 00:13:29.700  hesitant to take a bunch of risk. So Emerging Markets 266 00:13:29.700 --> 00:13:32.800  could be a little more volatile as you would expect but 267 00:13:32.800 --> 00:13:35.100  I think from evaluation standpoint there's room to run 268 00:13:35.100 --> 00:13:38.600  as well over time relative to the US let's let's 269 00:13:38.600 --> 00:13:41.300  look at the other side of the coin and talk a 270 00:13:41.300 --> 00:13:44.500  little bit about bonds because that's been quite the Hot Topic lately. We've been 271 00:13:44.500 --> 00:13:47.900  getting a lot of inquiries from advisors and investors alike 272 00:13:47.900 --> 00:13:50.700  about the fixed income market. So give us 273 00:13:50.700 --> 00:13:52.300  a little perspective of what's happening in. 274 00:13:53.500 --> 00:13:57.300 Global fixed income right? Well, if you recall 2022 275 00:13:56.300 --> 00:13:59.500  was a historically bad year 276 00:13:59.500 --> 00:14:02.900  for Boston certainly, right as as fed as 277 00:14:02.900 --> 00:14:05.500  the FED raised interest rates are not just the FED but central banks 278 00:14:05.500 --> 00:14:08.500  essentially around the world except for the Asian 279 00:14:08.500 --> 00:14:11.100  China and Japan those central banks not quite 280 00:14:11.100 --> 00:14:14.600  as much but globally central banks at the 281 00:14:14.600 --> 00:14:17.600  impact of course of challenging the yield right 282 00:14:17.600 --> 00:14:20.900  and as we know yield in price or are sort of inverse Lee 283 00:14:20.900 --> 00:14:23.300  related and so as yield was pushed up by raising 284 00:14:23.300 --> 00:14:26.900  rates price came down and and it had a pretty dramatic 285 00:14:26.900 --> 00:14:29.900  impact across the yield curve 286 00:14:29.900 --> 00:14:32.400  and that was globally as well the United 287 00:14:32.400 --> 00:14:32.400  States. 288 00:14:33.200 --> 00:14:36.400 2022 pretty much a very bad. No good year for 289 00:14:36.400 --> 00:14:39.400  Bond holders rolling into the first quarter 290 00:14:39.400 --> 00:14:42.400  a lot of those same sort of macro dynamics that 291 00:14:42.400 --> 00:14:45.400  we talked about with equities was 292 00:14:45.400 --> 00:14:48.500  true to fix income as well the expectation the bond 293 00:14:48.500 --> 00:14:51.800  market pricing that they think the FED will essentially 294 00:14:51.800 --> 00:14:54.600  be done at some point this year raising rates 295 00:14:54.600 --> 00:14:58.100  had the impact of markets rallying 296 00:14:57.100 --> 00:15:01.300  to a degree and then of course when there 297 00:15:00.300 --> 00:15:04.100  was volatility injected because of banking issues 298 00:15:03.100 --> 00:15:07.300  you continued to see a pullback 299 00:15:06.300 --> 00:15:09.700  on the the yield 300 00:15:09.700 --> 00:15:13.000  right? So at at some points we saw for instance 301 00:15:12.200 --> 00:15:15.400  the the 10 year get up over four and we 302 00:15:15.400 --> 00:15:18.500  saw a pullback as yields come down then of course prices go 303 00:15:18.500 --> 00:15:21.400  up. And so you saw a nice robust kind of response over 304 00:15:21.400 --> 00:15:24.500  the first quarter of prices coming up for bonds that had 305 00:15:24.500 --> 00:15:27.500  the impact and that was true for treasuries and corporates 306 00:15:27.500 --> 00:15:30.400  and international bonds, right? So across the 307 00:15:30.400 --> 00:15:32.900  Spectrum you had sort of a nice performance. 308 00:15:33.300 --> 00:15:37.100 For bonds for the first quarter. And again, it's unusual 309 00:15:36.100 --> 00:15:39.400  for fixed income and Equity to look and 310 00:15:39.400 --> 00:15:42.100  behave very similarly. That was one of 311 00:15:42.100 --> 00:15:45.700  the things that was so unusual about 2022, but there's still 312 00:15:45.700 --> 00:15:48.500  sort of Behaving the same way based on the same Outlook 313 00:15:48.500 --> 00:15:51.500  that at some point interest rates stop going up 314 00:15:51.500 --> 00:15:54.500  or stop getting ratcheted up by central banks. 315 00:15:54.500 --> 00:15:57.100  And so that Dynamic is is kind of 316 00:15:57.100 --> 00:16:00.700  floating all the boats to this degree and so 317 00:16:00.700 --> 00:16:03.500  fixed income has had a robust first quarter. 318 00:16:04.400 --> 00:16:07.700 Remains to be seen how the rest of the year plays 319 00:16:07.700 --> 00:16:10.400  out and and you know, frankly we 320 00:16:10.400 --> 00:16:13.200  continued to see the a deep 321 00:16:13.200 --> 00:16:16.200  inversion in the yield curve, especially at the 322 00:16:16.200 --> 00:16:19.100  very shortest end of the O curve relative to the 323 00:16:19.100 --> 00:16:22.700  10 year. And as you know that has historically sort 324 00:16:22.700 --> 00:16:25.300  of been a warning sign of 325 00:16:25.300 --> 00:16:28.600  potential economic stress recessions right 326 00:16:28.600 --> 00:16:32.100  as an indicator and it has remained it 327 00:16:31.100 --> 00:16:34.100  inverted for some time now 328 00:16:34.100 --> 00:16:37.900  and that inversion has only gotten deeper on the shortest end. So, 329 00:16:37.900 --> 00:16:40.200  you know again you would want to continue 330 00:16:40.200 --> 00:16:43.700  to watch that and be cognizant of it. I think the takeaway 331 00:16:43.700 --> 00:16:46.500  from this is much like with equities. It's best 332 00:16:46.500 --> 00:16:49.200  to be sort of broad based Diversified. You never 333 00:16:49.200 --> 00:16:53.000  know what part of the Yoke curve is gonna move relative to this and 334 00:16:52.900 --> 00:16:56.800  it's good to have exposure 335 00:16:55.800 --> 00:16:58.600  not just us treasuries, but 336 00:16:58.600 --> 00:17:01.200  the corporates and not just us bonds, but the international 337 00:17:01.200 --> 00:17:04.300  bonds that there are benefits built into the pricing of all 338 00:17:04.900 --> 00:17:08.400 And as we start to see a decoupling of Central 339 00:17:07.400 --> 00:17:10.400  Bank activity, yes, they've been 340 00:17:10.400 --> 00:17:13.700  acting pretty much in concert, but at some point central banks 341 00:17:13.700 --> 00:17:16.800  start to peel off right and they get back to focusing on 342 00:17:16.800 --> 00:17:19.100  the handling kind of 343 00:17:19.100 --> 00:17:22.300  their domestic concerns. And as they do that it will 344 00:17:22.300 --> 00:17:25.600  have varying diversification impacts for bonds 345 00:17:25.600 --> 00:17:28.500  around the globe the way stocks and bonds behaves 346 00:17:28.500 --> 00:17:31.300  in 2022 with similar and then into this quarter. We're 347 00:17:31.300 --> 00:17:34.500  seeing some decent returns globally across those two 348 00:17:34.500 --> 00:17:37.800  macro asset classes. We're seeing 349 00:17:37.800 --> 00:17:40.300  some of a mixed bag that last Factor investors 350 00:17:40.300 --> 00:17:43.400  from a factor perspective, right? But let's 351 00:17:43.400 --> 00:17:46.200  shift a little bit and talk about factors for a moment. 352 00:17:46.200 --> 00:17:49.300  We're a factor investors are listeners The Avengers that 353 00:17:49.300 --> 00:17:52.300  we work with our have clients invested in 354 00:17:52.300 --> 00:17:55.500  these Factor portfolios. What did we see from a factor standpoint 355 00:17:55.500 --> 00:17:58.800  in the first quarter of 2023 if 356 00:17:58.800 --> 00:18:01.400  you think about the factor of value, it's just the the 357 00:18:01.400 --> 00:18:04.300  cheaper stocks outperform the more expensive stocks over time and as 358 00:18:04.300 --> 00:18:04.500  you know, 359 00:18:04.800 --> 00:18:07.800 We had a long run where that wasn't true. Right we're 360 00:18:07.800 --> 00:18:10.300  growth stocks were just outperforming value to the 361 00:18:10.300 --> 00:18:13.200  point that everybody was sort of Naval gazing wondering his value 362 00:18:13.200 --> 00:18:16.800  dead. Does this even make sense anymore? And and what 363 00:18:16.800 --> 00:18:19.400  we sort of looking at it determined was 364 00:18:19.400 --> 00:18:22.400  no actually values kind of in line with what it's always done. It's 365 00:18:22.400 --> 00:18:25.300  growth. That's so unusual. Yeah, right and that we're 366 00:18:25.300 --> 00:18:28.300  back to the story about the large tech stocks and get over evaluation. Right? 367 00:18:28.300 --> 00:18:31.900  And so last year was a great year for Value, right? Even 368 00:18:31.900 --> 00:18:34.500  though it was down right value outperform growth 369 00:18:34.500 --> 00:18:37.800  by a good 20% Oh, yeah, absolutely and it 370 00:18:37.800 --> 00:18:40.700  was sort of that Snapback to recognition of 371 00:18:40.700 --> 00:18:43.300  hey one of my paying for right and and these things 372 00:18:43.300 --> 00:18:46.200  have gotten incredibly overvalued on the 373 00:18:46.200 --> 00:18:46.600  growth side. 374 00:18:47.300 --> 00:18:50.500 And so it shouldn't come as a surprise then if there's a reversal of 375 00:18:50.500 --> 00:18:53.600  that Dynamic that value might underperform growth 376 00:18:53.600 --> 00:18:56.500  over the first quarter. And of course, that's what we observed right 377 00:18:56.500 --> 00:18:59.300  that value underperformed growth. It was 378 00:18:59.300 --> 00:19:02.300  those large kind of growthy names that took off and and so that 379 00:19:02.300 --> 00:19:05.700  that factor shows up and demonstrates 380 00:19:05.700 --> 00:19:08.300  that thighs right. So again kind of 381 00:19:08.300 --> 00:19:11.600  the academic research that smaller cap 382 00:19:11.600 --> 00:19:14.400  names tend to outperform larger cab 383 00:19:14.400 --> 00:19:17.800  names over time rolling into the first quarter large 384 00:19:17.800 --> 00:19:20.500  caps outperform small caps, right again being led 385 00:19:20.500 --> 00:19:23.500  by that large growthy and so small caps 386 00:19:23.500 --> 00:19:26.800  tended to underperform in general. What's interesting 387 00:19:26.800 --> 00:19:29.300  is across factor is 388 00:19:29.300 --> 00:19:32.300  one of the reasons you want to hold small caps isn't necessarily the size 389 00:19:32.300 --> 00:19:35.300  Factor premium associated with that because 390 00:19:35.300 --> 00:19:38.700  that's come under some scrutiny of 391 00:19:38.700 --> 00:19:41.400  Lee as academics kind of look at that. Say what 392 00:19:41.400 --> 00:19:42.200  do we actually getting here? 393 00:19:42.900 --> 00:19:46.000 But what really expresses itself 394 00:19:45.300 --> 00:19:48.500  in small camp names or all the other factors, right? So 395 00:19:48.500 --> 00:19:51.100  the reason you'd want to hold a small cap is not just 396 00:19:51.100 --> 00:19:54.200  because you get a benefit versus large caps, but because you get 397 00:19:54.200 --> 00:19:57.600  a really strong value signal a really strong momentum really 398 00:19:57.600 --> 00:20:00.200  strong quality, right all of these things. And so if we 399 00:20:00.200 --> 00:20:03.300  look at small caps the performance of small caps for 400 00:20:03.300 --> 00:20:06.700  the first quarter, you actually got to really strong quality signal 401 00:20:06.700 --> 00:20:09.700  in small caps. So again a reason 402 00:20:09.700 --> 00:20:12.400  why you want to have a multiple exposures for your 403 00:20:12.400 --> 00:20:15.400  factors not just pick any one of these right so small 404 00:20:15.400 --> 00:20:18.400  caps under form large caps, but quality did really well inside 405 00:20:18.400 --> 00:20:21.300  small camps that makes up the next category is 406 00:20:21.300 --> 00:20:24.400  momentum. And what's interesting about markets that are sort of 407 00:20:24.400 --> 00:20:27.500  whipsawing one way or the other that momentum tends to 408 00:20:27.500 --> 00:20:30.400  have a tougher time in markets where the signal is really 409 00:20:30.400 --> 00:20:33.100  hard to pick up where there's a lot of whipsawing effect up and down on the 410 00:20:33.100 --> 00:20:37.000  other way momentum tends to kind of get whipped around with that. 411 00:20:37.700 --> 00:20:40.200 Eventually when markets start to pick 412 00:20:40.200 --> 00:20:43.300  up Trend whether that's down for a significant period of 413 00:20:43.300 --> 00:20:46.500  time like in 2022 momentum does well or up right 414 00:20:46.500 --> 00:20:50.000  for a significant period of time and so you 415 00:20:49.200 --> 00:20:52.400  would expect momentum to kind 416 00:20:52.400 --> 00:20:55.400  of settle down as markets kind of settle down 417 00:20:55.400 --> 00:20:59.600  and we see less whipsawing and more directionality. However, and 418 00:20:59.600 --> 00:21:03.300  I mentioned it earlier with small caps quality this idea 419 00:21:02.300 --> 00:21:05.000  that there may be 420 00:21:05.200 --> 00:21:08.800  a flight to Quality in times when the 421 00:21:08.800 --> 00:21:11.100  there's a lot of volatility. Well one of the 422 00:21:11.100 --> 00:21:14.800  reasons you see that is because higher quality earnings tend to 423 00:21:14.800 --> 00:21:17.400  hold up better in downturns. They have a premium 424 00:21:17.400 --> 00:21:21.300  associated with them and we saw that very clearly quality 425 00:21:20.300 --> 00:21:23.200  was one of the areas that outperformed the market 426 00:21:23.200 --> 00:21:26.200  over the first quarter and that was true not just in the 427 00:21:26.200 --> 00:21:30.200  US but internationally as well interestingly in 428 00:21:29.200 --> 00:21:33.500  Emerging Markets value quality 429 00:21:32.500 --> 00:21:35.600  and low volatility did quite 430 00:21:35.600 --> 00:21:37.600  well so value was still doing well in emerging. 431 00:21:37.700 --> 00:21:40.700 Markets again a reason why you'd want to diversify 432 00:21:40.700 --> 00:21:43.400  your Factor exposures not just in the US but 433 00:21:43.400 --> 00:21:46.900  internationally as well and minimum volatility was 434 00:21:46.900 --> 00:21:49.800  a contributor in us but lagged Market 435 00:21:49.800 --> 00:21:52.500  beta on the whole a broadly 436 00:21:52.500 --> 00:21:55.900  Diversified Factor exposure was I'd 437 00:21:55.900 --> 00:21:58.700  say depending on what your tilts are helpful on 438 00:21:58.700 --> 00:22:02.200  the downside when Market was volatile, but lagged 439 00:22:01.200 --> 00:22:04.900  Market beta to a degree for the 440 00:22:04.900 --> 00:22:07.500  first quarter where it outperformed in 441 00:22:07.500 --> 00:22:10.400  2022. So again factors are a 442 00:22:10.400 --> 00:22:13.500  long term investment. You wouldn't do it on based 443 00:22:13.500 --> 00:22:16.700  on one quarter, but we we watch the horse race, right? Yeah. 444 00:22:16.700 --> 00:22:19.200  Absolutely and I think a point that you 445 00:22:19.200 --> 00:22:22.400  you said that really resonated with me is the notion of how these factors work 446 00:22:22.400 --> 00:22:25.800  together right size and quality you mentioned 447 00:22:25.800 --> 00:22:29.200  and so having a diverse portfolio 448 00:22:28.200 --> 00:22:30.700  of integrated factors. 449 00:22:31.500 --> 00:22:32.800 maintaining that for the long term 450 00:22:34.200 --> 00:22:37.400 Should reward you over the long term. Yeah, and that's the 451 00:22:37.400 --> 00:22:40.800  expectation. There are lots of factors out 452 00:22:40.800 --> 00:22:43.800  there that have been identified in the academic literature when you 453 00:22:43.800 --> 00:22:46.400  selectively go out and pick a handful of 454 00:22:46.400 --> 00:22:49.500  those factors. The expectation is every single 455 00:22:49.500 --> 00:22:52.500  one of those is going to be a positive contributor to 456 00:22:52.500 --> 00:22:55.400  your portfolio over time, right you you 457 00:22:55.400 --> 00:22:58.300  wouldn't necessarily pick one that you thought. Well, it's gonna be a loser but we're gonna hold on 458 00:22:58.300 --> 00:23:01.100  to it, right you're picking all of these different factors of the 459 00:23:01.100 --> 00:23:04.700  expectation that each one of those is going to be a 460 00:23:04.700 --> 00:23:07.300  positive contributor over a period of time when you 461 00:23:07.300 --> 00:23:10.400  weave them together you sort of iron out 462 00:23:10.400 --> 00:23:13.400  the highs and lows of any one particular factor and 463 00:23:13.400 --> 00:23:17.100  you get that very nice steady stream of 464 00:23:16.100 --> 00:23:19.500  return into your 465 00:23:19.500 --> 00:23:22.300  portfolio. That's generated by those Factor exposures. Yeah. 466 00:23:22.300 --> 00:23:25.400  It's the old the old adage we're going for singles and doubles 467 00:23:25.400 --> 00:23:28.200  not home runs, right? Yeah. Yeah exactly. So let's 468 00:23:28.200 --> 00:23:31.200  talk a little bit about factors and fixed income and then 469 00:23:31.200 --> 00:23:34.100  we can take a look at some of the the factors overseas. 470 00:23:34.100 --> 00:23:37.800 As well, but I do want to spend some time on some of 471 00:23:37.800 --> 00:23:40.100  the headlines. So why don't we 472 00:23:40.100 --> 00:23:44.000  talk a little bit about us fixed income factors? Sure. So 473 00:23:43.600 --> 00:23:46.200  as you know, right fat factors are 474 00:23:46.200 --> 00:23:49.800  not an equity only thing. In fact, we see factors across 475 00:23:49.800 --> 00:23:53.600  all different kinds of assets fixed income Commodities 476 00:23:52.600 --> 00:23:55.400  housing real 477 00:23:55.400 --> 00:23:58.400  estate, right all these I the concept of value for 478 00:23:58.400 --> 00:24:01.500  instance and the concept of momentum right anything that has a price associated 479 00:24:01.500 --> 00:24:04.400  with it stores can demonstrate these sort of 480 00:24:04.400 --> 00:24:07.200  factors. And that's true. In fact fixed income the way we 481 00:24:07.200 --> 00:24:10.400  think about factors and fixed incomes specifically is is kind 482 00:24:10.400 --> 00:24:13.400  of interest rate risk, which is time, right? So think 483 00:24:13.400 --> 00:24:17.300  about what we talked about with the yield curve inversion 484 00:24:16.300 --> 00:24:19.400  and what was going on on the short end versus the 485 00:24:19.400 --> 00:24:23.500  long end what we've observed in the 486 00:24:23.500 --> 00:24:26.200  past. Let's call year was a really 487 00:24:26.200 --> 00:24:29.800  strong interest rate risk lack 488 00:24:29.800 --> 00:24:32.600  of benefit that you got for sort of being paid 489 00:24:32.600 --> 00:24:34.000  over time, right? 490 00:24:34.100 --> 00:24:38.300 And in theory, right you should get paid to hold 491 00:24:37.300 --> 00:24:41.100  over time because there's less certainty 492 00:24:40.100 --> 00:24:43.500  about what the future holds so you demand a 493 00:24:43.500 --> 00:24:46.800  premium to hold something over time to lend over time. And 494 00:24:46.800 --> 00:24:49.200  so when you have the short end 495 00:24:49.200 --> 00:24:52.500  of the curve come up that tends to impact that interest 496 00:24:52.500 --> 00:24:55.500  rate sets that risk that sensitivity because you're 497 00:24:55.500 --> 00:24:58.800  not getting paid over time. You're getting paid actually on the 498 00:24:58.800 --> 00:25:01.700  the shorter end potentially. So when you 499 00:25:01.700 --> 00:25:04.800  see a pullback of rates, 500 00:25:04.800 --> 00:25:07.700  right and price is going up you're seeing 501 00:25:07.700 --> 00:25:10.800  that benefit playing out through the first quarter as well credit risk 502 00:25:10.800 --> 00:25:13.300  is just the difference the buildup over 503 00:25:13.300 --> 00:25:16.300  the risk free rate treasuries to account 504 00:25:16.300 --> 00:25:19.200  for hey, you know a corporation has more risk than a government 505 00:25:19.200 --> 00:25:22.500  and I should be paid that difference. And so you're investing 506 00:25:22.500 --> 00:25:25.200  up and down the various yield curves that 507 00:25:25.200 --> 00:25:28.900  build up on that and in this case credit risk really as 508 00:25:28.900 --> 00:25:31.900  a factor wasn't a very solid contributor 509 00:25:31.900 --> 00:25:33.200  for the first quarter slightly positive. 510 00:25:34.100 --> 00:25:37.200 The the show really has been frankly for the 511 00:25:37.200 --> 00:25:40.500  past 18 months were interest rate risk is in 512 00:25:40.500 --> 00:25:43.500  terms of factor Premia in your portfolios. 513 00:25:43.500 --> 00:25:46.500  And then Market is is again just Market 514 00:25:46.500 --> 00:25:49.800  beta which is a buildup of all these different factors expressing themselves. 515 00:25:49.800 --> 00:25:53.200  So on the whole positive Bond performance 516 00:25:52.200 --> 00:25:55.500  being driven by changes to 517 00:25:55.500 --> 00:25:59.500  the the yield curve in many cases and some 518 00:25:58.500 --> 00:26:01.400  expectation that Bond markets are looking ahead 519 00:26:01.400 --> 00:26:04.600  and pricing for a cessation of rate raises 520 00:26:04.600 --> 00:26:07.500  by central banks. So so my expectation would 521 00:26:07.500 --> 00:26:10.200  be for for fixed income investors again much like 522 00:26:10.200 --> 00:26:13.400  Equity potentially more volatility here, right? The 523 00:26:13.400 --> 00:26:16.400  the rodeo is not over the big bull riding 524 00:26:16.400 --> 00:26:18.200  could yet be to come so 525 00:26:19.200 --> 00:26:22.400 You know stay patient the the benefit here is 526 00:26:22.400 --> 00:26:25.400  there's return associated with fixed income 527 00:26:25.400 --> 00:26:29.500  to a degree. We haven't seen in 15 years. And so 528 00:26:29.500 --> 00:26:32.700  let this play out. And again, these Factor 529 00:26:32.700 --> 00:26:35.600  exposures are the expectation is over time. These are 530 00:26:35.600 --> 00:26:38.100  going to be a additive to the returns that you 531 00:26:38.100 --> 00:26:40.700  get from the bond market you had mentioned this in some of your previous comments. 532 00:26:42.500 --> 00:26:45.400 Factors perform differently geographically too 533 00:26:45.400 --> 00:26:48.500  right like value in the US might give you a different return 534 00:26:48.500 --> 00:26:51.300  versus value and the international develop during the 535 00:26:51.300 --> 00:26:54.500  Emerging Markets Arenas. So I think there's diversification story 536 00:26:54.500 --> 00:26:57.600  there. Can you comment on that, please? Yeah. Well, yes, of 537 00:26:57.600 --> 00:27:00.100  course and and I sort of made a comment 538 00:27:00.100 --> 00:27:01.300  about as 539 00:27:02.300 --> 00:27:05.500 central banks become decoupled and start to operate a 540 00:27:05.500 --> 00:27:09.000  little more independently that it has an impact on the 541 00:27:11.300 --> 00:27:14.600 local economies in all of these different markets as 542 00:27:14.600 --> 00:27:17.200  an impact on their currencies. And so 543 00:27:17.200 --> 00:27:20.600  when you think about fixed income the benefit that you get from 544 00:27:20.600 --> 00:27:23.300  not only where you hold on 545 00:27:23.300 --> 00:27:26.500  the curve and and the amount of credit that you're willing but that 546 00:27:26.500 --> 00:27:29.900  you're going to diversify the various curves 547 00:27:29.900 --> 00:27:32.300  that you hold and the where you 548 00:27:32.300 --> 00:27:35.900  are on that across geographies and 549 00:27:35.900 --> 00:27:38.200  then take into account the impact that 550 00:27:38.200 --> 00:27:42.200  currencies might have right and so we know for equities 551 00:27:41.200 --> 00:27:45.100  the the volatility signature 552 00:27:44.100 --> 00:27:47.100  of equity is is so robust that 553 00:27:47.100 --> 00:27:50.600  you're you tend to be willing to hold the volatility of 554 00:27:50.600 --> 00:27:53.900  fluctuations and currency in in 555 00:27:53.900 --> 00:27:56.000  fixed income. It tends not to pay you to do 556 00:27:56.200 --> 00:27:59.400  that. And so I know for instance 557 00:27:59.400 --> 00:28:03.100  that here at Cemetery you folks hedge back 558 00:28:03.100 --> 00:28:07.000  to the dollar sure and that takes some of that volatility out, 559 00:28:06.600 --> 00:28:09.400  right? And again, I think that's a benefit 560 00:28:09.400 --> 00:28:11.000  for Factor investors because what you're 561 00:28:11.200 --> 00:28:14.300 Is less volatility associated with fluctuations currency and 562 00:28:14.300 --> 00:28:18.000  you're getting maybe stronger signal from these these 563 00:28:17.200 --> 00:28:20.900  different sources of return across 564 00:28:20.900 --> 00:28:23.400  different markets and they're all going to be hitting at 565 00:28:23.400 --> 00:28:26.700  different times. Once the sort of the global economy 566 00:28:26.700 --> 00:28:29.200  comes unpegged to what's going 567 00:28:29.200 --> 00:28:33.100  on fighting inflation. Yeah until I think it's a perfect diversification story 568 00:28:32.100 --> 00:28:33.300  and 569 00:28:34.100 --> 00:28:37.600 we have a saying here that the only free lunch and investing is diversification. And 570 00:28:37.600 --> 00:28:40.900  so we tout that investor should be embracing that Casey. 571 00:28:40.900 --> 00:28:43.400  Thank you so much for joining us that concludes part one. 572 00:28:43.400 --> 00:28:46.600  Please feel free to access other podcasts 573 00:28:46.600 --> 00:28:49.000  that we have done and they can be 574 00:28:49.400 --> 00:28:52.600  accessed anywhere you get your podcast. 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