In 2014, equity markets slowed compared to the torrid pace of 2013. The Global Dow increased less than 1% in the first quarter of 2014. US markets finished weak with the United States Dow Jones Industrial Average (DJIA) down less than 1%.
I continue to overweight stocks versus bonds because I believe most of the slowdown in economic activity was weather related as winter produced record snow across the upper regions of the United States. These weather-related issues will fade as we move into spring selling season.
Our investment portfolios tracked markets so far this year. Looking forward, we continue to believe first quarter earnings will be solid and may be a catalyst to move the markets higher before the end of 2014.
Car buying and home purchases remain strong and we believe this will help the markets this year. My investment approach is to buy companies with consistent earning power, high return-on-equity while employing little or no long-term debt and to purchase at reasonable prices.
I have a system that filters thousands of stocks on a weekly basis using the Sparrow multi-point checklist that screens the highest quality companies, which are then reviewed and considered for purchase in your portfolio.
DISCLAIMER: The investments discussed are held in client accounts as of March 31, 2013. These investments may or may not be currently held in client accounts. The reader should not assume that any investments identified were or will be profitable or that any investment recommendations or investment decisions we make in the future will be profitable. Past performance is no guarantee of future results.
Sparrow Capital Management is a registered investment adviser based in Missouri. Gerry Sparrow, an investment professional with more than 20 years of investment management experience, is our President and Founder. He selects stock investments using a proprietary matrix of fundamental, quantitative and technical factors.