November 2023:Thankfulness


November 28, 2023
Dow: 35,417

It should not be cliché to say that we have much to be thankful for. We live in the democracy that has led the world for most of the past one hundred years. Our economy has continued to thrive on innovation. All of our largest technology companies were founded in the last fifty years; three of them have been around less than 25 years. They have been a key to the continued growth and prosperity in this country and around the world, and are supported by thousands of smaller companies, many of them also entrepreneurial success stories. There are many investment opportunities outside of the largest tech companies, as valuations outside of tech are currently below average, and the economy is continuing to expand.

Regarding the economy and markets, we are most thankful that the economy has endured the Fed rate hiking cycle and seems to have thrived in spite of the flurry of rate increases. Real GDP rose 5.2% in the third quarter, the strongest quarter of growth since 2014, aside from the post-Covid bounce. We have also experienced a productivity bump, with real GDP expanding more than 7% since the end of 2019, while unemployment has only increased 1.5%. This productivity increase is positive and has helped the economy deal with the bump in inflation. The S&P 500 Index has almost fully recovered from its recent July-October correction. The landscape looks very different today from the beginning of the year when the end was not in sight for rate increases, trailing inflation was still above 6%, and earnings declines were widely expected.

Unemployment is going up for the right reasons, as more people join the labor force. The elasticity of labor supply will help mitigate fears of a resurgence of inflation driven by demand increases and a more limited supply of labor. This is one case where unemployment increases due to growth in the labor force are a good thing as long as overall job growth continues to expand, and it has.

While the rebound in stocks can be attributed to the end of rate increases and the resilience of the economy, we can also be thankful for the recent decline in longer term interest rates. Over the last five weeks, longer rates have declined about 70 basis points, offering some relief from impending borrowing cost increases. Even the red hot housing market shows signs of leveling off, as existing home sales have dropped significantly.

With employment growth remaining strong, consumer confidence should also remain strong, or even strengthen, into 2024. Much of our economy is driven by confidence. It drives financial transactions of all types, including driving individuals and companies to spend and invest. If we do not experience disinflation next year, we should enter an environment where real wage growth should strengthen and families will recoup some of the purchasing power they lost in 2021 and 2022.

We are also thankful to announce that three of our investment strategies were named to PSN’s Top Guns List of best performing separate accounts, managed accounts, and managed ETF strategies for 3Q 2023.

  • Concentrated Dividend Equity – 5 Stars, Large Value Universe
  • Unconstrained Equity – 3 Stars, Large Growth Universe
  • All Cap Equity – 2 Stars, All Cap Equity Universe

We are proud of these three equity strategies’ notable 3Q rankings and are already hard at work with the goal of achieving similarly strong rankings and results for our investors in 4Q. Published quarterly by Zephyr, the highly anticipated PSN Top Guns list is one of the most important references for investors and asset managers. Rankings are tabulated for thousands of strategies across 75 peer groups subdivided by increasingly rigorous screens and reported in ascending classes from 1-6 stars.

At Dana, we are thankful for a challenging work experience that supports personal growth, excellent colleagues with which to share our career journey, and clients that we are fortunate to serve and with whom we have built beneficial and lasting relationships


Random Thought: “Showing gratitude is one of the simplest yet most powerful things humans can do for each other.” – Randy Pausch, author of The Last Lecture




[2-Star Category:] had one of the top ten returns for the one-year period in their respective strategy.

[3-Star Category:] had one of the top ten returns for the three-year period in their respective strategy.

[5-Star Category:] had an r-squared of 0.80 or greater relative to the style benchmark for the recent five-year period. Moreover, the strategy’s returns exceeded the style benchmark for the three latest three-year rolling periods. Products are then selected which have a standard deviation for the five-year period equal or less than the median standard deviation for the peer group. The top ten returns for the latest three-year period then become the 5 Star Top Guns.