Spring Yield
By Julien B. Booth
April 16, 2017
Good Evening:
I hope this note finds you well and I hope you had a wonderful Easter.
Generally, I would feel compelled, to begin with a Spring metaphor. After 2016 tax season (always thank your CPA), a blistering (good) quarter in the credit market, and falling calves (weekend job) it seems only fair to count our blessings.
On that note, I am most grateful for the ability to do what I find enjoyable (wake up daily with no idea what is going to happen) in the markets.
13 years ago, just after the birth of my first daughter, we (Kelly blessed it) started Forest Capital. The lights remain on and we have been very fortunate to steadily grow.
This business would have never been built without the faith and trust of our friends, clients, and family. We are grateful and appreciate each of you. Thank you.
Forward Looking
We have written several notes regarding the shifting sentiment post-Trump election. With time, and the post-election shock rhetoric subsiding, the reality of macroeconomic conditions vs. policy is materializing.
We are primarily U.S. based investors (seem to find plenty of opportunities here) and believe our systems, politics, and structures are easier to understand. It is our investment market of choice.
The U.S. remains a favorable place and our portfolios are geared toward a modest growing U.S. economy. The post-Trump spike in Treasury yields has been fading…likely indicating the growth/inflation euphoria subsiding. We continue to find value in capital trust (floating rate) securities, a handful of closed-end income funds (always secondary market!), and some higher yielding credits that our sister co., Sixty Guilders Research uncovers. For additional detail please let me know.
As usual, thank you for investing with Forest Capital! For additional information on portfolio positioning, please contact Forest Capital directly at jbooth@forestcapital.net.