Key insights
- A value investor's Q1 2026 portfolio outperformed the S&P 500 and Russell 2000. However, the investor found it difficult to find new value opportunities due to geopolitical uncertainty (Iran situation) making it harder to assess margins of safety. This suggests a cautious outlook on deploying capital in the current environment, potentially signaling a period of lower equity allocations.
I am a long term, value-oriented investor. I take positions in companies which trade at discounts to their intrinsic values and where downside risk is low compared to upside potential.
For the first quarter ended March 31st, 2026, my portfolio achieved a pre-tax return of 45%, comparing well with the S&P 500's & the Russell 2000 negative returns. The excellent quarter was partly due to a couple of stocks with standout returns.
Prices for many issues fell this quarter, but unlike previous market dips, I found it hard to find value with the Iran situation making it more difficult to evaluate margins of safety.