Dynamic Brands: The Investment Portfolio Filled with Key Blue Chip Brands We Have Strong Emotional Connections With. Brands Matter.
Household Consumption Drives Every Major Economy & Leading Consumer Brands Have a History of Strong Performance
Yet Most Investors are Chronically Underweight Consumption Stocks.
That’s Why a Dynamic Brands Allocation Matters To Your Portfolio
Over the last 3 Years, Many Consumer Stocks Compounded Well-Under their Long-term Return Annual Rates.
A lot of Catch-up Potential Still Exists. That’s the Opportunity Today For Investors
History Lesson Below:
38 Years of Data: Investing in a Basket of Leading Consumer Stocks Has Added Significant Value to a Portfolio.
The Consumer Basket Outperformed the S&P 500 by >200bps Annualized for 38 Years
Why? They are Industry Titans, Have Global Opportunities, and Operating in a Consumption-Led Global Economy
Looking Back, There Were Two Other Periods When Consumer Stocks Had Laggaing 3 Year Returns
What Did the Next 3 Year Period Look Like? Outperformance
History Shows, Adding to the Consumer Basket When 3Yr Returns Are Sub-Par Adds Real Value.
Adding Capital Paid Handsomely For the Full 6 Year Period (3 YR Underperformance + 3 Year Outperformance)
Our team took over HSUTX on 10/17/2017. Since 2017, we have experienced 3 stock market bear markets (down 20%+ in 2018 from peak, 2020 for early Covid, and 2022 with historic Fed tightening), multiple bouts of extreme volatility and uncertainty, a bout of 40+ year high inflation, rapidly rising and volatile interest rates, bank failures, and wars in Ukraine & Israel. That’s a lot of turmoil and uncertainty for markets to digest. From 2017 to the peak of the market in late 2021, the fund annualized at 23%, well above the normal average. In today’s “new normal” economic and rate regime, more normal equity returns should be expected and leading brands should continue to add value to a portfolio.
Bull Market Period: 10/17/2017 (Brands inception) to Market Peak, November 2021
Bear Market of 2022 - Rates Rose at Historic Pace, Growth & Quality Factors Lagged Significantly (A Rare Occurrence)
When Leading Tech & Consumer Discretionary Brands Go on Mega-Sale - You Become an Opportunist & Buy Great Brands On Sale
Since the October 2022 Low: High Quality, Highly Relevant Brands Return to Leadership
YTD 2024 Through March 31, 2024: Global Brands, a Quality Bias, Active Trading Matter
Dynamic Brands Looks Very Different than the S&P 500 Index - By Design; Making HSUTX a Great Compliment to SPY
Exposure to the S&P 500 Index
Global Consumption Investing: We Fish From the Right Part of the Lake
Since Sector Index Inception late 1990, Only 4 Sectors Have Outperformed S&P 500 on Annualized Basis
Simple Annual Average Calendar Returns 1990-2023: Tech, Consumer Discretionary & Healthcare Are the 3 Leaders
34 Years of Data: A Few Sectors Tend to Rise to the Top. Most Investors are UNDERWEIGHT Consumer Stocks
On a Calendar Return Basis Since 1989, Consumer Discretionary Has the Best Beat Rate Versus All Sectors Versus the S&P 500
The % of Time in a Calendar Year Each Sector Outperforms the S&P 500
Dynamic Brands Current Holdings as of April 15, 2024
Blue Chip, Mega Brands, Drive the Core of the Portfolio: Currently 90% of the Total (Varies Over Time)
Current Emerging Mega Brands Holdings:
Faster growing, Disruptive Brands Taking Market Share & Creating New Markets.
