Value Equity Insights

Magnificent…Small Caps? Why Now and Why Confluence (April 2024)

A Report from the Value Equities Investment Committee | PDF Why Small Caps? Small capitalization stocks have spent the better part of 10 years in the shadows of their larger cap brethren but now currently provide an attractive opportunity, in our estimation. The divergence has been driven primarily by the narrow focus on a select… Read More »

Back to the Future: The Advantages of Dividend Income Over Interest Income (February 2024)

Insights from the Value Equities Investment Committee | PDF Over the past 15 years, dividend income has often exceeded what could be earned in a money market account. But as seen in the chart below, with the fed funds rate now at 5.5%, the relationship between dividend income and interest income has gone back to… Read More »

Is It Different This Time? (December 2023)

A Report from the Value Equities Investment Committee | PDF For the better part of the past seven years, the broad indexes have been driven by the strength of a handful of mega-cap technology-oriented businesses, namely: Alphabet, Amazon, Apple, Meta, Microsoft, NVIDIA, and Tesla. The narrow focus is beginning to cause some investors to question… Read More »

A Good IDEA for the Long Run: The Benefits of Increasing Dividends (December 2021)

A Report from the Value Equities Investment Committee | PDF In this report, we examine the long-term outperformance of stocks with growing dividends; why certain dividend growers outperform and their attributes; how those attributes correspond to our approach when selecting businesses for the IDEA portfolio; and the impact of inflation on dividend stocks. Why Dividends?… Read More »

The Case for Small Caps (December 7, 2020)

by Bill O’Grady, Mark Keller, and Dan Winter | PDF To measure market capitalization, we use the Wilshire Large Cap and Wilshire Small Cap indices. The following chart shows the log-transformed ratio. On this chart, a rising number indicates stronger large caps relative to small caps. In general, small caps tend to outperform coming out… Read More »

Shining a Light on Indexes – How to Help Investors Better Achieve Their Goals (July 2020)

A Report from the Value Equities Investment Committee | PDF “What is the appropriate benchmark for your strategy?” This is a question frequently posed to an investment manager. Before this question can be answered, it is necessary to gain a solid understanding of the strategy by examining the manager’s investment philosophy and how it is… Read More »

IDEA Dividend Update (March 31, 2020)

A Report from the Value Equities Investment Committee | PDF Growing dividends are at the core of Confluence’s Increasing Dividend Equity Account (IDEA) strategy. Given the unprecedented nature of a national economic shutdown to combat COVID-19, it is likely that many companies, including some that may be held in the IDEA portfolio, will choose to… Read More »