Q3 2024 Recap
Quarterly Recap on how both new and old ideas performed during Q3 2024
At one point early in the year the prospect of rate cuts in 2024 seemed out of the question; inflation remained a nagging worry for the Fed through the first half of the year, and a Presidential election in the back half of the year would ordinarily restrain those Dovish voices who may prefer to loosen things up but would rather not act in any way that may “politicize” the Fed. Well, the Fed has been politicized for years now and lost all credibility a long time ago (in my opinion at least), so why should an ordinary thing like an election have any affect on them today? Bam! 50bps in September with more on the way, and the market continues to scream higher.
The markets in general were frothy over the summer as the prospect of rates cuts became a reality, with the Dow Jones up something over 5% during the quarter while both the S&P500 and NASDAQ100 were up over 9% and 10%, respectively, at the time of this writing (and from the close of my last quarterly update). The measure I tend to track most, the Russell 2000, after a brief shining moment of outperformance to start the quarter, fell back to its standard underperformance and managed only to rise around 4%.
Before continuing, the standard disclaimer holds; nothing here is investment advice, and I make absolutely ZERO guarantees about future results. No matter how often I may comment on how well or poorly things have behaved overall, that doesn’t mean the next quarter things will behave similarly. None of the performance measurements I use for comparison purposes are even remotely close to those used by the standards bodies; mine are simple averages while theirs use additional inputs. Mine also don’t account for standard concerns like borrowability, market cap, weighting, and rebates in the calculations. This most recent quarter is simply a three-month snapshot on a handful of names that should always be considered in the broader context of an overall portfolio. As always, don’t take my word for anything, consult with your own financial professional, and do your own due diligence.
Over here at Short Ideas, Q3 2024 was a somewhat sleepy, summer doldrums-type of a quarter, but we still managed to find a few ideas that we thought worthy of sharing with our loyal subscribers.
During Q3 2024, I published on 7 ideas, 6 of which were new ideas (I classify an idea as “new” if it is not on my most recent interest list), 4 of which I classify as regular ideas, 1 of which was a “quick take” idea, and 1 idea that was exclusive to “Founding Members” only. I also “restacked” one older idea that I had removed from my list a while back, but have once again started following after the stock underwent a 300% move. Of the 4 regular new ideas, there was one outlying name that was down over 95% since I first mentioned it, which was only a little over a month ago (it is also worth mentioning that the stock more than doubled following my spiel before completely falling apart). There were 2 names that were each down over 40% from the time of mention, and the most recent idea I shared with subscribers has been the lone underperformer, rising 20% since I first mentioned it. The lone “quick take” idea is essentially flat, higher by about 1%, while the lone “Founding Members” idea has declined close to 60% since I first shared that idea with those half-a-dozen subscribers. And the “restacked” name? Down over 20%. As a portfolio, those 7 names are down an average of 34% during the quarter, which is a fairly decent showing on the new idea front.
As in the past, a few of the more well-known “activist” investors found 4 of our ideas worthy of additional work, and shared those names and research results with their followers…