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Blog
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Sep 19, 2023
Catching the Wave: Why Secular Growth Matters
In our view, the specific market dynamics that influence a company's sales growth prospects have a greater impact on equity returns than the overall direction of the economy.
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Blog
Aug 31, 2023
Artificial Intelligence: A Seismic Secular Growth Opportunity
Artificial intelligence (AI) has been top-of-mind for investors for much of 2023, fueling a strong rally in the S&P 500. While it may take time for AI to have a similar impact on small cap stocks, we share the market’s enthusiasm and believe AI has the potential to become one of the most disruptive secular growth trends ever.
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Video
Aug 1, 2023
Quarterly Webinar Replay
If you were unable to join our quarterly webinar on July 27th, listen to the replay to hear updates from Portfolio Managers John Osterweis, Greg Hermanski, Nael Fakhry, and Carl Kaufman.
During the webinar, Chris Zand moderated a discussion about recent market activity and trends, portfolio positioning, and the investment team's outlook.
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Outlook
Jul 18, 2023
Third Quarter Equity Outlook
The S&P 500 has generated double digit returns so far in 2023, but the gains have been narrowly focused. Heading into the second half, we will be watching to see whether the rally broadens or the market capitulates.
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Outlook
Jul 18, 2023
Third Quarter Strategic Income Outlook
Despite persistent inflation and elevated short-term interest rates, the economy appears to be holding up well, and we believe the Fed may deliver the “soft landing” it has been trying to engineer.
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Outlook
Jul 14, 2023
Third Quarter Total Return Outlook
The economy has held up remarkably well despite the Fed’s tightening program, but with two more hikes likely in 2023, the risk of a slowdown remains elevated.
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Blog
Jul 13, 2023
Focus on Dividend Growth, Not Dividend Yield
Dividends have historically played an important role in shareholder returns. In our view, companies that pay growing cash dividends also tend to reinvest in themselves, which can drive growth in cash flow and provide attractive returns with less volatility over time.
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Blog
Jun 30, 2023
Five Benefits of Setting Up a Trust
A trust can be an important part of your overall estate plan and a way to ensure your loved ones and assets are protected for the entirety of your life and beyond. We outline what we believe are some of the top benefits of adding a trust to your estate planning portfolio.
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Blog
May 30, 2023
The Risk of Playing It Safe
Investors have been loading up on T-bills and money market funds this year, but according to our Total Return team, that is not a sustainable strategy as it exposes investors to both reinvestment risk and inflation while creating an asset/liability mismatch.
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Blog
May 25, 2023
Ignoring the Noise and Focusing on Return on Invested Capital
What drives return on invested capital (ROIC), and why should this metric matter to a long-term investor? We believe that understanding a company and its industry structure is imperative to determining the trajectory of ROIC, which dictates whether a company will generate attractive returns over time.
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Outlook
May 2, 2023
Second Quarter Equity Outlook
Despite recent market volatility, particularly in the banking sector, we believe the economy is currently experiencing several significant secular growth trends that will create strong tailwinds for companies that are well-positioned to capitalize.
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Outlook
Apr 17, 2023
Second Quarter Total Return Outlook
Thanks to the recent banking crisis, the Fed’s “dual mandate” has taken on a new meaning. The increased economic uncertainty during the first quarter drove investors towards safer assets, boosting investment grade bonds.
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Outlook
Apr 13, 2023
Second Quarter Strategic Income Outlook
2023 has already been an eventful year, featuring a banking crisis and more Fed rate hikes. In our view, this is not a “set it and forget it” type of market – investors need to stay vigilant.
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Blog
Feb 15, 2023
Unexpected Risks and Opportunities from the Inverted Yield Curve
Many investors have attempted to capitalize on the inverted yield curve by purchasing long-term Treasuries (assuming continued declines at the long end will cause their bonds to appreciate). In his latest commentary, Venk Reddy, CIO of our Sustainable Credit Strategies, explains why he feels this approach is materially riskier than investing in short duration fixed income.
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Outlook
Jan 12, 2023
First Quarter Strategic Income Outlook
2022 was a difficult year for bond investors, but the combination of high inflation and tighter Fed policy should keep yields elevated, creating materially stronger fixed income returns in the new year.
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Outlook
Jan 11, 2023
First Quarter Equity Outlook
In 2022, inflation and interest rates both rose substantially, creating the near-term potential for a recession. In the new year, we think investors should focus on companies that are well-positioned for an economic slowdown as well as continued price increases.
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Blog
Jan 10, 2023
Things Are Getting Sticky. Prices Always Have Been.
Although inflation appears to have peaked, historical data suggests that prices are unlikely to reverse themselves, which could lead to an extended period of wage inflation. For fixed income investors, the silver lining is that the Fed may be reluctant to lower rates anytime soon, which should translate into higher bond yields.
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Outlook
Jan 5, 2023
First Quarter Total Return Outlook
2022 was a rough year for fixed income, but we anticipate better days ahead as the Fed will likely keep rates elevated in its ongoing battle against inflation.
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Blog
Dec 19, 2022
Quiet Quitting? Quiet Firing? More Like Quiet Retiring
Structurally tight labor markets are providing support for tighter monetary policy, but the Fed may be fighting an uphill battle. A post-pandemic labor shortage is one of the biggest challenges in the struggle against persistent inflation, made worse by baby boomers retiring, as noted by Fed Chair Jay Powell in his remarks on November 30, 2022. If this retirement ripple becomes a wave, inflation may stay higher for longer, driving up yields and creating the most favorable fixed income investment environment in decades.
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News
Nov 22, 2022
Wealth Management Checklist
Is there a gap in your financial plan? Are you wondering if you are on track to meet your wealth management goals? Download our checklist to find out.
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Blog
Nov 18, 2022
Back to the Future: Traveling in Time to Navigate Today’s Markets
We believe the market is currently undergoing a substantial paradigm shift that could impact bond investors for years to come. The end result: We may be entering a golden age of income, reminiscent of a period in the distant past when investors focused on fundamentals and clipped coupons rather than prioritizing short-term price appreciation.
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Outlook
Oct 21, 2022
Fourth Quarter Equity Outlook
Investors today probably feel a bit like the joker and the thief from Dylan’s classic, “All Along the Watchtower” – there’s too much confusion, they can’t get no relief. But our Core Equity team believes there is a way outta here – investing in dominant companies that pay growing dividends.
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Outlook
Oct 18, 2022
Fourth Quarter Total Return Outlook
The Fed remains singularly focused on containing inflation but has made little headway so far. We anticipate the tightening cycle will continue, which will keep downward pressure on risk assets.
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Outlook
Oct 11, 2022
Fourth Quarter Strategic Income Outlook
2022 has hit investors with an unprecedented 1-2 punch of sharply negative returns in both the equity and fixed income markets, but our Strategic Income team feels the selloff has created attractive opportunities in high yield bonds.
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Blog
Sep 26, 2022
20 Years of Common Sense Investing: Our Top 5 Principles
We have always believed that common sense is the key to successful investing. Since launching our Strategic Income Strategy two decades ago, our straightforward, flexible approach has allowed us to navigate all types of markets and consistently deliver strong risk-adjusted returns over time.
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News
Sep 26, 2022
Osterweis Virtual Roundtable Replay
If you were unable to join the Osterweis team for the Virtual Roundtable, you can watch the replay here after filling out a short form.
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Blog
Aug 24, 2022
Strategic Income Strategy: Built to Withstand Challenging Markets
2022 has been a tough year for fixed income, as the Fed tightening cycle, inflation, and recession fears have all weighed heavily on markets. We believe the Osterweis Strategic Income strategy is well-positioned to address these types of challenges, as its flexible mandate and defensive approach help to protect against rising rates and market volatility.
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Blog
Aug 23, 2022
A Solutions-Based Investing Approach
There is no such thing as a one-size-fits-all approach to investing, which is why we focus on our clients’ unique needs when developing our investment strategies.
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Blog
Aug 18, 2022
Navigating Short-Term Dislocation Through Long-Term Thinking
Thanks to general concerns about shorter-term bonds and fears of a looming recession, many shorter duration securities are currently yielding more than longer duration securities. According to Venk Reddy, CIO for our Sustainable Credit Strategies, to properly capitalize on this unusual situation, investors must distinguish between strong credits that are discounted due to decreased market sentiment versus those with deteriorating fundamentals.
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Blog
Aug 2, 2022
The Fed Has a Third Mandate, and the Market Has a New Imaginary Friend
Much has been made of the market’s relationship with the Fed in recent months, but what has only been mentioned in passing is the impact on market psychology of past Fed actions. When paired with a Fed that is hyperaware of those market psychologies, we find ourselves seeing an interesting dynamic develop today as the Fed battles inflation on one hand and the risk of a recession on the other.
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Blog
Jul 20, 2022
Fundamentally Challenged or Fundamentally Cheap? Bargain Hunting in a Down Market
2022 has been a rough year for fixed income investors (among others), as most bonds have experienced double digit losses. Perhaps the only silver lining to this situation is that many securities have declined in price even though the issuer’s credit quality has not materially changed, which has created some excellent buying opportunities for active managers like us.
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Blog
Jul 15, 2022
Short-Term Investing with a Long-Term Perspective
Ironically, the short-term bond market works best for patient investors with longer-term horizons, as many participants have high liquidity needs and will sell quality bonds at a discount in order to raise cash quickly. This creates buying opportunities for investors like us, as we are always happy to hold a strong credit to maturity, especially if we can purchase it below its fair market value.
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Blog
Jul 12, 2022
Inflation vs. Stagflation: A Distinction Without a Difference?
The stagflation scenario predicted as imminent by some economists never quite came to pass… at least not yet. Meanwhile, the current state of inflation appears to be the results of a series of seemingly one-off scenarios. However, if one looks closer, patterns begin to emerge.
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News
May 17, 2022
MarketWatch: What’s Next for the Stock Market as Investors Grapple with Fed Near ‘Peak Hawkishness’
The portfolio managers for the Osterweis Total Return Fund (OSTRX) were recently quoted in a MarketWatch article discussing the Fed’s current policy predicament and potential strategies for managing inflation.
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News
Apr 19, 2022
Zeo Team Joins Osterweis
We are excited to announce that on May 1, 2022, Zeo Capital Advisors' six employees became part of the Osterweis team. Their additional expertise allows us to expand our fixed income strategies and product suite into ESG-focused short duration and sustainable high yield.
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Blog
Mar 8, 2022
Market Perspectives: Our Latest Thoughts on Ukraine
The Ukraine conflict has escalated rapidly, creating a massive humanitarian crisis and increasing volatility across financial markets. In this piece we review the major economic implications of the war and discuss the steps we are taking to manage the impact on portfolios.
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Blog
Jan 5, 2022
In Search of Upside: Finding Opportunities in Small Cap Growth
Small cap growth stocks lagged for most of 2021 as the market simultaneously dealt with the pandemic, inflation, and tightening Fed policy. Given these challenges, we have been focusing on high quality companies trading at attractive valuations, and we have also been looking at non-technology businesses that are embracing digitization.
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Blog
Dec 7, 2021
The Power of Tax-Efficient Compounding
With day trading making headlines, it seems that many investors have lost focus on the value of a buy-and-hold approach. We explain why it may make sense to harness the potential power of tax-efficient compounding when it comes to long-term wealth creation.
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Blog
Sep 30, 2021
Is the Fed Ignoring Its Own Inflation Data?
The Fed continues to assert that elevated inflation is largely due to “transitory factors,” but the Underlying Inflation Gauge, which is published by their own New York branch, tells a different story. To understand where inflation is heading, we advise investors to pay close attention to UIG data, even it if the Fed doesn’t.
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News
Jun 11, 2021
MarketWatch: Is inflation eating up all the interest you’re earning on 10-year Treasury notes?
In this MarketWatch article, Eddy Vataru, CIO-Total Return, discusses his thoughts on inflation.
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Blog
Jun 3, 2021
Inflation in 2021: Why It Could Be Different This Time
Inflation has been top of mind for investors throughout 2021. The question going forward is whether recent price increases will be transitory or persistent. In our view, the risk of sustained inflation is higher now than at any point in recent memory.
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Blog
Mar 31, 2021
Price Makers, Share Gainers, and Compounding Machines: Three Quality Business Models
Defining a quality business is easier said than done. We have found that the highest quality businesses either consistently exercise pricing power while maintaining market share or consistently grow market share by undercutting incumbents. A choice few companies we call “compounding machines” can both raise price and increase market share.
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Blog
Dec 28, 2020
Back to (the New) Normal: Five Secular Growth Trends for 2021
The coronavirus pandemic is a once-in-a-lifetime event that transformed society and the economy almost overnight. We believe some of the most significant changes are likely here to stay, and we are focusing our investments on the secular growth trends we expect to strengthen as life returns to normal.
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Blog
Dec 7, 2020
The Case for Waste: Finding Growth in Garbage
Although investors don’t normally think about trash when they’re looking for growth stocks, we believe the solid waste industry is well-positioned to outperform. In our view, the combination of high barriers to entry, stable demand, and opportunities for consolidation should provide reliable revenue growth for the foreseeable future.
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Blog
Aug 14, 2020
A Bright Future for Renewables: Lower Costs and Rising Demand
Following decades of investment and cost reduction, electricity from renewable energy should be cheaper than most existing fossil- and nuclear-fueled electricity within the next three-to-five years. We believe selectively investing in operators with scale and cost advantages in this sector should be rewarding given the increasing demand for clean energy.
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Blog
Jul 8, 2020
Steepening the (Adoption) Curve: Covid-19 and Digital Transformation
In the era of social distancing, technology has become even more integrated into our personal and professional lives. We believe this trend will persist even after the pandemic passes, and we expect it will particularly benefit firms that support remote working arrangements and eCommerce, two areas where we anticipate accelerating adoption and sustained growth.
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