SWI - Headwaters Capital Q1 2024 Investor Letter

2024-04-09 05:45:00 ET

Summary

• Headwaters Capital Management is an actively managed, concentrated investment strategy focused on small and mid-capitalization stocks.
• The Headwaters Capital Management portfolio returned +10.6% during Q1 2024 vs. +8.6% return for the Russell Mid Cap Index over the same period.
• Q1 was another strong quarter for the equity markets broadly, with gains again led by large caps.
• The Headwaters portfolio outperformed the Russell Mid Cap benchmark due to positive stock selection.

Dear Investors,

The Headwaters Capital Management, LLC ("Headwaters Capital," "Headwaters," or the "Firm") portfolio returned +10.6% (+10.4% net) during Q1 2024 compared to a +8.6% return for the Russell Mid Cap Index over the same period. A brief discussion of the performance and trading activity during the quarter is presented below.

Performance Discussion - Q1 2024

Q1 was another strong quarter for the equity markets broadly, with gains again led by large caps (S&P 500 +10.4% v. Russell 2000 +5.0%). The Headwaters portfolio outperformed the Russell Mid Cap benchmark due to positive stock selection (see below). Market performance during Q1 '24 was characterized by three themes that carried over from Q4 '23....

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