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Matthew McLennan: 2024 Annual Letter to Shareholders

In this 2024 annual letter, Matthew McLennan and team reflects on a year marked by concentrated equity market performance, macroeconomic challenges, and geopolitical shifts. They emphasizes the importance of diversification, value-oriented investing, and hedging against uncertainty in an evolving global landscape.

Key Takeaways:

  • Market Concentration: U.S. tech-driven stocks dominated 2024 market gains, with the “Magnificent Seven” contributing disproportionately to the S&P 500’s performance. Broader market growth was more subdued, highlighting diversification challenges.
  • China’s Economic Struggles: China’s post-pandemic recovery faltered due to its zero-COVID policy, tech sector crackdowns, and property market issues, leading to slower growth and global disinflationary effects.
  • U.S. Economic Fragility: The U.S. labor market remained resilient, but wage inflation stayed above target levels. Late-year Federal Reserve rate cuts introduced potential new inflationary risks.
  • Gold as a Hedge: Gold performed strongly amid geopolitical tensions and central bank buying, reinforcing its role as a hedge against extreme risks and currency debasement concerns.
  • Investment Approach: Matthew and the team prioritizes selectivity and diversification, focusing on scarce quality and value at attractive prices while maintaining a structural allocation to gold for portfolio resilience.

Given equity market performance trends over the past two years, it can be tempting to ride the wave of “narrative economics” that has driven index-level performance.

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Disclaimer of liability

The above has been prepared by Børsgade ApS for information purposes and cannot be regarded as a solicitation or recommendation to buy or sell any security. Nor can the information etc. be regarded as recommendations or advice of a legal, accounting or tax nature. Børsgade cannot be held liable for losses caused by customers’/users’ actions – or lack thereof – based on the information in the above. We have made every effort to ensure that the information in the above is complete and accurate, but cannot guarantee this and accept no liability for errors or omissions.

Readers are advised that investing may involve a risk of loss that cannot be determined in advance, and that past performance and price development cannot be used as a reliable indicator of future performance and price development. For further information please contact info@borsgade.dk

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