Though 2020 was a generationally poor period for value indexes relative to growth, hopes that the worst of the Covid-19 recession was behind us helped fuel a fourth quarter rebound in the mature, p
As long-term investors, we think it is important to take the right message from the strong broad market returns in 2020. As we’ve often cautioned, extrapolating trends is a risky way to commit capital, particularly when these trends reflect an extraordinary operating environment like that in 2020.
Although 2020 ended with the Covid-19 pandemic surging and the economic recovery from recession still far from complete, investment markets nonetheless maintained a state of exuberance that was not necessarily rational.
While equity markets continued their rebound from the depths of the Covid-19 selloff, leadership shifted as signs of a “reflation” trade that emerged in September persisted.
After clawing back its losses from the Covid-19 selloff throughout much of the second and third quarters, the high yield market moved solidly into positive territory for the year during the fourth quarter.
First Eagle Funds
Shareholder Servicing Agent
PO Box 219324
Kansas City, MO 64121-9324