INSIGHTS

2023 Observations:

• Market returns were driven by a small handful of mega-cap stocks, primarily on optimism over artificial intelligence, which he finds eerily similar to the late 1990’s dot-com era.
• The Russell 1000 Growth Index posted its strongest return since the inception of the index in 1979, gaining over 42% in 2023.
• The wide gap between the returns for the Russell 1000 Growth and Russell 1000 Value Indexes exceeded 30%, one of the largest on record.
• The 16% gap between the median return of the index constituents and the cap weighted return was the largest since the late 1990's dot-com bubble.
• Marty also notes that large growth returned over 42% in 2023, far outpacing the 29% decline in 2022, yet the 2-year annualized return is approximately 0.5%. This highlights the power of downside protection in compounding long-term results.