performance Archives - Sycamore Financial Group

Performance, Markets and The Economy

Hello from Sycamore,

Performance and the Markets

Our Growth and Income Composite gained just a bit less than 0.5% over the past year (gross of all fees). This is significantly better than the -7.7% by the S&P 500. Historically our strength has been to hold value better during market declines and it seems to be true again during this market cycle. We still expect the markets to do reasonably well in 2023. We know that there is a lot of concern about a pending recession, but we’ve now been hearing that for more than a year and we’ve not seen it yet.

As you already know, we do our own research and analysis to make security selections rather than send your money to a 3rd party manager or mutual fund to be managed. This means that we are ‘in the weeds’ each-and-every week. Currently, we see most companies growing earnings at a rate we’d normally expect. Of course, there are exceptions, but on the whole, we are still finding many bargains and we’re looking forward to an uneventful 2023.

The Economy

One of the primary reasons that we are in a higher interest rate environment is inflation. It continues to be a problem and the Federal Reserve is continuing to raise interest rates – although the rate of increase seems to be slowing and we believe we are near the top for now. Producer prices continue to drop, and we’ve found that the Consumer Price Index tends to follow. We’re hopeful that inflation will ease significantly this year. Also, the amount of money in our economy (M-2) is now shrinking. We believe that this will slow the inflation rate. Many economic indicators are performing well. Retail sales continue to be strong, and the consumer is a very large part of our economy. The unemployment rate remains at near record lows and our economy continues to create new jobs at a very good rate. New orders for durable goods are strong and even sales of existing homes and new starts are staging a nice recovery. We remain optimistic overall, and we believe that most companies can operate profitably in our current economic environment.

Purchase and Sale Activity During Q-1

During the 1st quarter of 2023, we bought Generac (GNRC), Paychecks (PAYX), IBM, ASGN, and ADP. We sold Sally Beauty (SBH).

As always, do not hesitate to reach out to our offices at (765) 455-1554 to discuss this.

Thank you for your continued trust and support,

Sycamore Financial Group

*Data not audited
*Results reported gross fees
**Past performance does not assure future results. Investors cannot invest directly in the stock market indexes such as the S&P 500. Investment return and principal value of an investment will fluctuate. Investor value, when sold may be worth more or less than their original cost.

Looking at Some Economic Indicators – Fall 2005

Better Than It Seems

As we’re meeting with our clients this fall, many are pleasantly surprised with the performance of their investment accounts. We frequently hear something like “ That’s great. With the market and economy being in so much trouble we were concerned that our investments may be as well” It seems that today more than at any other time, the perception of both the economy and the markets (mostly from the media) is very much different from the reality (the actual performance numbers).

The perception: crippling hurricanes, high gas prices, increasing interest rates and, so far this year, a quietly sagging stock market. Ouch!

The reality: Hurricanes? Nothing new there. Gas prices? Adjusted for inflation, the’re in the same neighborhood as 1982*. Interest rates? It could be that the rising interest rates are a positive indicator about the strength and the expansion of our economy. A quietly sagging stock market? Truth be known we’ve come to appreciate quiet markets.

Let’s take a look at some economic indicators.

The Department of Commerce reported that second quarter 2005 Gross Domestic Product grew at a 3.3% annualized rate. A good rate.
Housing starts rose 3.4% for September 2005 to an annual rate of 2.11 million units**. This is the fastest pace since Feburary and one of the highest rates ever.
The Bureau of Labor and Statistics reported that the September 2005 unemployment rate was 5.1% (not the best we’ve ever seen, but certainly not the worst). Over the last twelve months ending in August 2005, payroll employment grew by an average of 194,000 a month and the unemployment rate has trended downward during that year.

Those of you who have been investors over the last ten,twenty, thirty or more years know that there is always an abundance of negative news. You also know how well the markets overall, and in particular your individual investments, have performed over those same periods.

We’re not saying that everything is rosy; we know that there is room for improvement. We are however, recommending that the next time you feel a little uneasy because of the current dose of bad news, call us for a closer look at reality.

Thanks for your business,
Sycamore Financial Group

*The Big Picture. Posted 8/17/05
** U.S. Department of Commerce report dated 10/19/05

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Past performance does not assure future results. Investors cannot invest directly in the stock market indexes such as the S&P 500. Invest return and principal value of an investment will fluctuate. Investor value, when sold, may be worth more or less than their original cost. The material in this presentation is for illustrative purposes and does not reflect any particular investment.