Kim Bolton, president and portfolio manager of Black Swan Dexteritas

FOCUS: Technology stocks

MARKET OUTLOOK:

As of April 19, the S&P 500 Index is down about five per cent from its all-time high at the end of March, and investors are being reminded of the fact that stocks go in more than one direction. That shouldn’t be news to anyone, but as we’ve noted several times since March, sentiment towards the economy and stock market by both consumers and investors alike was starting to reach extreme levels. While we won’t point to any specific examples of hubris regarding the path of the economy or the market, investors were overdue for a reality check. Don’t get us wrong; we aren’t predicting that the current episode will develop into a deeper drawn-out decline, but crazier things have happened. What we can tell you is that we would much rather head into earnings season with investors, including ourselves, feeling a little bit of fear rather than gliding along with no worries. Additionally, fear has started to creep into the market as the American Association of Individual Investors bull-bear spread dropped this week to its lowest levels since November. As the Grateful Dead song goes, “When life looks like easy street, there is danger at your door.”

Your Black Swan Dexteritas Team’s active management practice has proven to be the right recipe for these volatile markets. We will continue to trim those securities that are achieving their respective intrinsic values and buy those growth stocks that exhibit longer, more lucrative investment runways. The hedging overlay will also be an important tool to protect your capital in bearish markets, and also an important tool to be “dialled down” in bullish markets.

TOP PICKS:

Astera Labs (ALAB NASD)
Overall, Astera's competitive advantages lie in its advanced technology, scalability, user-friendly interface, flexibility and strong customer support. These factors make Astera a preferred choice for businesses looking for efficient and reliable data integration and management solutions.     

Marvell Technology (MRVL NASD)
Marvell Technology provides innovative and high-quality electronic components and solutions. Their commitment to technological leadership, diverse product portfolio, manufacturing excellence, global presence, strong partnerships, and consumer-centric approach contribute to their success in the market.

Broadcom (AVGO NASD)
Broadcom is a prominent player in the semiconductor industry. Their broad product portfolio, technological expertise, strong intellectual property, manufacturing efficiency, market leadership, strategic acquisitions and customer relationships contribute to their success and growth in the market.

PAST PICKS: June 7, 2023

Analog Devices (ADI NASD)

• Then: US$180.37
• Now: US$200.23
• Return: 11 per cent
• Total Return: 12 per cent

Dell Technologies (DELL NYSE)

• Then: US$47.66
• Now: US$120.92
• Return: 154 per cent
• Total Return: 159 per cent

Monday.com (MNDY NASD)

• Then: US$167.54
• Now: US$186.82
• Return: 11 per cent
• Total Return: 11 per cent

Total Return Average: 61 per cent