Q4 2024 Newsletter

Q4 2024

Dear Investors,

2024 has been another great year for investing, which reflects our returns at The Stewardship Fund. There are many unknowns going into 2025 with the markets near all time highs, valuations looking stretched, a new president in office, AI advancing rapidly, and many other events that have the potential to shake things up in surprising ways. Because of all of the uncertainty, The Stewardship Fund is beginning to purchase a few thoughtful hedges to protect our positions. For those not familiar with hedging, we are basically buying “insurance” against a broad market downturn. These purchases will of course reduce our returns by a small amount, but they will provide a great deal of protection and comfort in the event of a large market downturn.

At the Stewardship Fund, we are always seeking ways to better align ourselves with our investors. As a result of this effort we are lowering our performance fees! Investors who have been with us for at least two years will begin seeing their fees drop over time. By implementing this discount we are continuing to pursue an investor friendly fund model. It has always been my goal, as the General Partner, to make The Stewardship Fund function in a way that would make me happy to invest as a long term investor. I believe that long-term loyalty discounts help move us firmly in that direction.

People ask me all the time what I think is going to happen in the market over the next year. My answer is always the same: I don’t know. The reason for this is simple: no one has ever been able to predict the market consistently in the short term, so what would make me think I could do it! You may be wondering why I would choose to buy “insurance” (puts) if I don’t know what’s going to happen. This is the key question, and the answer is that the markets are clearly expensive right now, which in turn makes the risk of a large drawdown in the market much higher. I prefer to stay fairly fully invested, so rather than raise a lot of cash, we are able to protect ourselves from much of the downside risk by buying puts on the overall market.

We are still focused on long-term results with quality companies as we always have been; however, these puts allow us to continue to buy up quality companies when the opportunities present themselves while simultaneously reducing the overall portfolio risk. With this type of positioning we are actually eager for a market downturn as it will provide an amazing opportunity to purchase more quality companies at great discounts. We are excited to see what the next year will bring, and either way the market moves, we are ready to make decisions that will benefit us for the years to come.

Portfolio Performance

In the fourth quarter The Stewardship Fund added another gain of 2.81%, leading to a total return of 43.82% since inception after all fees. We continue to see steady and consistent gains in our portfolio, and we believe this is set to continue in 2025. Despite the market’s lofty valuation, we believe we are positioned to do well in almost any market condition.

We have chosen to hedge our portfolio in order to seek greater safety and stability for our portfolio in the face of elevated valuations. Because of the hedges we have put in place, we will suspend the sharing of our full portfolio at this time. It is my desire to bring this disclosure back soon, but I don’t want to mislead investors by only listing our stock positions when the options can make a large difference in our actual returns. In place of the exact portfolio, I would like to share a list of the stocks we own with rough percentages to help those who follow see a general idea of what we are doing. You can see the fund’s continued performance as well as most of the stocks we own below.

Over 20% 10%-15% 5%-10% 2%-5% -EPD -META, GOOGL -ENB, MAIN, CTO, ARE -EPR, O, NNN

Thank you so much for your support, partnership, and prayers. We are excited to see what 2025 has in store!

God Bless, 

Pastor Bobby Boyd 

General Partner & CEO of The Stewardship Fund

Q4 2024 Newsletter (1).pdf

Download PDF • 176KB