NOKBF - ClearBridge Dividend Strategy Q1 2024 Portfolio Manager Commentary

2024-04-06 06:45:00 ET

Summary

• ClearBridge is a leading global asset manager committed to active management. Research-based stock selection guides our investment approach, with our strategies reflecting the highest-conviction ideas of our portfolio managers.
• The market’s rise continues to be led by a small handful of mega cap technology names, with those companies and the IT sector together now accounting for almost 40% of the S&P 500 Index.
• We took advantage of attractive valuations in out-of-favor sectors to increase our exposure in consumer staples, communications services and utilities, all areas typified by muted cyclicality, recurring revenues and predictability.
• Over the years, our nimble approach to dividend investing has enabled us to participate across sectors, including in some higher-growth names that many passive or formulaic dividend investors likely missed.

By John Baldi, Michael Clarfeld, CFA, & Peter Vanderlee, CFA

All Eyes on AI Leaves Much Overlooked

Market Overview

The first quarter provided a terrific start to the year for the S&P 500 Index ([[SP500]], [[SPX]]) and the ClearBridge Dividend Strategy (SOPAX). The S&P 500 rose 10.56% and the Strategy was up about 70% as much. This relative performance is consistent with our expectations. With our dividend focus and conservative approach, we tend to lag in momentum-led markets like the current one. Conversely, we tend to outperform in sharply declining markets. Recall 2022; the market sunk 18% while we were down less than half as much....

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