LOM Equity Growth Fund Manager’s Report Q3 2022

After an exceptional 2021, the first three quarters of 2022 have been challenging for equity fund investors. Concerns over the Federal Reserve aggressively raising interest rates and thereby causing a recession have weighed on risk markets across the board.  During the third quarter, the LOM Equity Growth Fund declined in price as markets tumbled around the world.

Since the beginning of this year, the U.S. economy and stock market have been hit by the perfect storm. Russia’s invasion of Ukraine began a bloody and disruptive war in Europe, China’s COVID lockdowns added to supply chain disruption woes and hawkish central bank policies all conspired to knock down asset values.

Overall, it was a volatile third quarter for global markets. The MSCI World index rose as much as 11.94% before closing the month down -6.07%. Central banks signaled resolve in raising rates to combat high inflation, creating fear in the markets that the actions will tip us into a global recession. Recently, indices have fallen back to technical support levels.

In the US, Consumer Discretionary (4.36%), Energy (2.16%) and Financials (-3.10%) were the strongest performing sectors. Communications (-12.71%), Real Estate (-11.03%) and Materials (-7.13%) were the weakest sectors this quarter.

In this environment, we continue to focus on higher quality companies with a degree of defensiveness. Recent new positions include some in the energy, electric utility and consumer staples sectors while we continue to increase our weighting in value versus growth allocations.

The information contained in this article is for information purposes only, and represent the views of the author. It is not intended as specific investment or financial advice, or a recommendation or solicitation to buy or sell any security. Any investments or strategies listed in this article may not be suitable for all investors. Past performance is not indicative of future performance, and as with any investment, prices may fluctuate. It is recommended that advice is sought from a qualified investment professional prior to implementing any financial plan. LOM has made every effort to ensure that the contents herein have been compiled from sources believed reliable, however LOM does not warrant the accuracy, adequacy, timeliness, or completeness of this information expressly disclaims liability for errors or omissions in this information.