Eric Clark, Portfolio Manager

In my 30-year career working in financial services, I have been a Financial Advisor, a professional trader, and a long-term investor of iconic brands (along with a host of other roles in the industry). As someone who has worked directly with advisors for most of my career, I have a lot of empathy for you and your team during these tumultuous times. Managing hundreds or thousands of client portfolios is hard enough, but managing their emotions through a cycle is a monumental task, particularly now.

In the "return generation business", institutional investors have a big edge over retail investors. The WHY is what's most important: institutional investors have access to the smartest asset managers in the world, have the time, experience, and resources to assess all potential investment ideas, have a long-term time horizon (wide lens investing), and act opportunistically when asset prices get weak.

Let's talk athleisure because it's a powerful secular growth theme and there's some absolutely dominant brands in the category. We can't talk about sneakers and footwear without leading with Nike. Nike is one of the most recognized and loved brands around the world. Once called Blue Ribbon Sports, Nike was founded by Bill Bowerman and Phil Knight in 1964.

The difficulties of navigating markets in 2022 are well chronicled. Very difficult years tend to create investor PTSD, which often holds them back from uncovering opportunities. In my conversations with advisors and analyzing money flow data, there appears to be lingering apprehension for risk-taking initiatives.

As a reminder, each December our team at Accuvest goes through a rigorous process to update the investment universe for the Dynamic Brands equity strategy. The result is a 200-company list called the Alpha Brands Consumer Spending Index. 90% of the 200 brands are domiciled in the U.S. and 10% are international brands. The majority of the 200 leading brands have sales that come from outside their local borders. That is the nature of being a global brand. Why do we anchor to a smaller sub-segment of the market for our investment universe? Because we are singularly focused on the massive portion of global GDP that comes from household and business spending. This component accounts for more than 60% of global GDP or roughly $44 trillion each year. If the definition of “core” is: the most important part of something, could there be a better core equity choice than something tethered to the largest portion of global economic activity?

As a reminder, each December our team at Accuvest goes through a rigorous process to update the investment universe for the Dynamic Brands equity strategy. The result is a 200-company list called the Alpha Brands Consumer Spending Index. 90% of the 200 brands are domiciled in the U.S. and 10% are international brands. The majority of the 200 leading brands have sales that come from outside their local borders. That is the nature of being a global brand. Why do we anchor to a smaller sub-segment of the market for our investment universe? Because we are singularly focused on the massive portion of global GDP that comes from household and business spending. This component accounts for more than 60% of global GDP or roughly $44 trillion each year. If the definition of “core” is: the most important part of something, could there be a better core equity choice than something tethered to the largest portion of global economic activity?

In case you missed last week's blog, I'll start with the same theme. There's been significant damage to asset prices in 2022. Last year was one of the most difficult environments for investors in almost every asset class. Here's the updated 60/40 portfolio yearly scorecard going back in time via a recent report from Private Equity leader, KKR:

In case you missed last week's blog, I'll start with the same theme. There's been significant damage to asset prices in 2022. Last year was one of the most difficult environments for investors in almost every asset class. Here's the updated 60/40 portfolio yearly scorecard going back in time via a recent report from Private Equity leader, KKR: