Global equity markets have been eventful in the last few months . Are recent market developments a sign of a deeper shift ? One supportive of bottom-up contrarian investors like us ?

Recent volatility has shown the impact that currency movements can have on financial markets . But the recent moves in stocks are also worth a deeper look . Global equity markets have been just as lively as currency markets-and just as encouraging .

In markets , sometimes good news is good news , sometimes bad news is good news , and sometimes , good news isn ’ t good enough news . The last two months have seen all three varieties in the US alone . Inflation ticked down , which is good news for the economy and for markets . Yet manufacturing orders tanked , job creation slowed , and jobless claims accelerated . Bad news for the economy , but good news for markets , as the weakness urges the Fed to cut interest rates . Though a weaker economy is typically bad news for small firms , they have outperformed handily . That ’ s partly because lower rates would reduce their interest costs , and partly because good news for some big firms wasn ’ t good enough to beat stretched expectations .

It ’ s a lot to process . Even if we knew the headlines in advance , we ’ d still struggle to predict what they would all mean for stocks . So we focus instead on what we are good at — analysing individual businesses .

Few businesses are immune to broader economic forces , but for most of them , it simply isn ’ t the most important thing , and what makes or breaks

one company may be totally irrelevant to another . Nintendo creates video games and consoles , but isn ’ t remotely concerned with vehicle-based payments . Corpay operates niche payment networks , but has no interest in video games . The service quality of freight carriers matters enormously to RXO but not at all to Shinhan Financial Group . Many of these businesses across our Strategies have recently outperformed , and when the performance of what you own is idiosyncratic , it is a bit easier to tune out the broader market noise .

At times over the past year , that noise has felt loud , even when the companies we hold have been delivering good results . Our Global Equity Strategy generated better returns last November and December than it did this July and August . But with the market outpacing us late last year , it sure didn ’ t feel that way ! To use an Olympics analogy , we had great race times , but our competition was on a tear , and gold gets all the attention .

We weren ’ t throwing in the towel then , and we aren ’ t resting now . Yet we do see reasons for excitement . The opportunity set has for years led us more towards value over growth stocks , financials and industrials over tech names , and mid-sized firms over giants . That ’ s been

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