Q1 2026 - War, AI, and Uncertainty

Dear Shareholders, 

The first quarter of 2026 has been a significant period for the markets. As discussed in previous letters, I began the year preparing for a tumultuous environment. While a direct conflict with Iran was not my specific baseline, we have always maintained readiness for "black swan" events capable of disrupting an expensive market. This preparation allowed us to manage risk effectively while capitalizing on several exceptional opportunities that emerged this quarter. With uncertainty now a dominant market theme, I would like to share my perspective on the war and AI, as I believe these are the most pressing topics for investors today. 

War 

Historically, war introduces uncertainty, which markets naturally resist. Recent headlines have ranged from "The biggest energy crisis in history" (World Affairs in Context, 2026) to reports of portfolios moving entirely to cash. These fears are real and often trigger impulsive selling. The consequences of this conflict are indeed significant; the closure of the Strait of Hormuz has cut off roughly 30% of the world’s oil and natural gas, along with critical resources like helium. 

However, as long-term value investors, our approach is to "zoom out". Short-term disruptions rarely have a lasting impact beyond a year or two. I consistently ask: "Will this affect this company in three years?". For the quality businesses we own, the answer is almost always "no". Rather than selling into temporary weakness, we have utilized this dip to add to existing positions and initiate new ones at attractive valuations. I am highly confident these purchases will prove to be excellent long-term opportunities. 

The pace of change is currently unprecedented. For example, during the drafting of this letter, news shifted from a potentially catastrophic prolonged war to a ceasefire announcement, followed by renewed fears of re-eruption. This volatility is why we prioritize buying great companies with a margin of safety. When the focus remains on quality and duration, long-term success becomes much more attainable. 

AI 

AI represents a different, and likely larger, structural disruption than war. While it brings its own set of fears, it also offers immense opportunity. As the fastest-implemented technology in history, AI will impact the world in ways we are only beginning to grasp. We are constantly evaluating how AI might disrupt or improve our businesses, and identifying where market hype has led to overvaluation versus where fear has created opportunity. 

I have spent considerable time researching AI to build a solid foundation for these evaluations. While no one can be certain of the future, it is clear that the ultimate goal is to achieve something called Artificial General Intelligence (AGI). AGI refers to AI reaching human-like cognitive abilities across a wide variety of tasks. It is unclear if this goal of super-intelligent AI will come to fruition, but if it does, the world will never look the same. 

With predictions of over 1 billion AI robots by 2035 (https://www.citigroup.com/global/insights/the-rise-of-ai-robots), the rate of change is staggering. Although the actual rollout may be slower than predicted, every investment must be viewed through an AI lens. 

Our Portfolio and the Road Ahead 

When evaluating our holdings, I focus on the "moat". Most of our businesses are in strong positions: 

● Google, Meta, and Amazon: These are AI leaders poised to benefit from increased adoption.

● EPD and REITs: These are largely insulated due to their vast physical infrastructure, which remains essential regardless of AI advancements. 

● Salesforce (CRM): While AI poses a greater perceived risk here, I believe this threat has created an amazing opportunity to acquire a high-quality, competitive name at a discount. 

Not every company will survive the AI transition, but the best will thrive. We are focused on high-quality names depressed in price, providing a strong long-term outlook relative to valuation. Once the market uncertainty settles and the winners become clear, I believe our new acquisitions will be worth much more in the future. 

Perspective on the Road Ahead 

While the future remains inherently unpredictable, our strategy for success remains anchored in the long-term ownership of high-quality companies. Time is a powerful ally; the longer we maintain our positions in these businesses, the greater our probability of achieving strong returns. While we remain vigilant in evaluating the evolving investment landscape, we strive to remain insulated from the reactionary fear that often accompanies the natural vicissitudes of market cycles. 

Below is an overview of The Stewardship Fund’s performance and current holdings: 

T

Conclusion 

When asked where the market is headed in the near term, my honest answer remains, "I don’t know". The market is fundamentally unpredictable, and anyone claiming otherwise is mistaken. 

What I do know is that by staying disciplined and invested in quality through uncertain times, we position ourselves for future success. This portfolio is built on a foundation of resilient businesses that I believe are equipped to thrive regardless of what the future holds. 

God Bless, 

Bobby Boyd 

CEO of The Stewardship Fund 

PS: For those still skeptical of AI’s impact, I want to share a practical example: while I wrote the original draft of this letter, it was fully edited and refined using AI. The technology was able to concisely clarify my thoughts in truly impressive ways. 

Across countless industries—both seen and unseen—we are witnessing massive shifts in productivity driven by these tools. I fully expect this trend to accelerate moving forward. However, every technology has its limits; as investors, our job is to navigate this new frontier while acknowledging that we don't yet know where those boundaries lie. 

Robert@thestewardshipfund.net  

The Stewardship Fund

This material is for informational purposes only and does not constitute investment, legal, or tax advice. It has been prepared without regard to the individual financial circumstances and objectives of persons who receive it. Past performance is not indicative of future results.