Hello, 2024
Stock market indices rose again last week, ending 2023 on a 9-week winning streak. Friday also capped off a fantastic year for those investors that were long the indices. For 2023, the Dow was up over 13%, the S&P 500 was up over 24% (over 26% with dividends included), and the Nasdaq Composite was the big winner, rising more than 43% (with the Nasdaq 100 being an even bigger winner, gaining more than 53% before dividends).
Last year, in our Welcome to 2023 newsletter, we included a chart with select performance in 2022 to show the divergence between growth and value stocks during the year:
Using those same six ticker symbols for comparison, here is what 2023 looked like for those names:
What a difference a year makes! The biggest losers in 2022 became major winners in 2023. For further comparison, let’s look at a 2-year return (before dividends) for all of the same securities:
If you’d have boarded a boat to travel the world at the end of 2021 and paid exactly zero attention to the stock market until this weekend, when you saw this 2-year chart, you might have thought the last couple of years were fairly uneventful. You might have guessed that earnings grew a bit, but the highly-valued stocks from 2021 de-rated enough to keep index returns close to flat, and Berkshire’s stock just about matched the approximate growth in its business.
But, as we who haven’t been on a boat for the last two years know, some things have happened during the last couple of years—some exciting things, some painful things—and the word uneventful is far from an accurate description of that journey.
And that brings us to 2024. What might this year bring? As always, forecasting markets and economics falls somewhere between complicated and impossible—so we don’t do it. But we expect the new year, once again, won’t be uneventful. Markets rarely are.
Happy New Year!
“It’s possible to be right about the macro-future once in a while, but not on a regular basis. It doesn’t do any good to possess a survey of sixty-four forecasts that includes a few that are accurate; you have to know which ones they are. And if the accurate forecasts each six months are made by different economists, it’s hard to believe there’s much value in the collective forecasts.” —Howard Marks
Lunch at the Club
Co/Investor Club Premium Members have access to Lunch at the Club, our monthly investor presentation. As we ring in the new year, we are gifting our newsletter subscribers December’s presentation video and pitch deck. Please check it out using the links below!
Last week, Anthony Franklin at Spearhead Capital Partners discussed search funds and presented his current fund.
Watch Anthony's Lunch at the Club Presentation
Download Spearhead Capital Partners Deck
Join our Premium investment community for exclusive access to all of the past presentations, research, and invitations for future opportunities.
Tweets of the Week
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10 Questions For 2024 - by Ben Carlson
A Letter a Day: Letter #150: Stephen Mandel and Garrett Moran (2020)
Planet MicroCap Podcast: MicroCaps in 2023: Boring is Sexy Again
Value Hive Podcast: Alberto Ayuso: Shipping & Tankers 101
Focused Compounding Podcast: Ep 420. 2023 in Review and 2024 Predictions
The Investor’s Podcast: Stock Market History & The AI Bubble w/ Jamie Catherwood
If you have not already upgraded your membership…
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