Posted by: Tom McKeon on July 19, 2018
In This Issue: Review & Outlook 2Q-2018, Volatility Update, Portfolio Activity, Clothier Springs Capital Partners, What Business Are We In?, Our Quarterly Harangue: "Structure IS the Strategy" and Clothier Springs Capital Management Has a Birthday
2Q-2018 Reviw & Outlook
Outside of U.S. small caps and U.S. real estate, returns for the 2Q-2018 period were modest to meager. The specter of a global trade war sparked by poorly conceived tariffs punished the emerging markets sector significantly.
Volatility is subdued again as the markets approach or breach all-time highs. Volatility is a central feature of markets and security prices. Our short, options hedging program takes advantage of volatility and in that regard, we like higher volatility. Unfortunately, higher volatility comes with investor anxiety and falling markets.
We added two new positions in 2Q-2018 and added to several more. We initiated a position in the Legg Mason Infrastructure ETF (INFR). This ETF seeks to track the investment results of an index composed of infrastructure-related equity securities from global markets. Sub-sectors within the fund are utilities, industrials, energy and real estate.
Clothier Springs Capital Partners
We made one new investment during the quarter. We placed $115,000 with the First Equity Funding Group of Sea Girt, NJ.
What Business Are We In?
Asking an advisor about performance is the wrong question. Your outcome will be far more dependent on his fees and business model.
Our Quarterly Harangue: "Structure IS the Strategy"
As anyone in business must, we pay great attention to the universe of financial service vendors we hypothetically compete with. Most of them leave us scratching our heads wondering, “how do they get away with that” or “how do they say that with a straight face.”
Clothier Springs Capital Management has a Birthday
June 30th, 2018 was the eighth anniversary of the official registration of Clothier Springs Capital Management by the Pennsylvania Department of Banking and Securities as an independent Registered Investment Advisor.