For much of the last cycle, owning the index was the trade. Liquidity lifted all boats, correlations rose, and the cost of capital sat near zero. That regime is over.
Beneath a placid surface, dispersion — the gap between winners and losers — has quietly returned to levels not seen since the early 2010s. When capital is scarce, business quality is repriced. Companies with pricing power, durable moats and reinvestment runway are being rewarded; those dependent on cheap financing are not.
Our framework is unchanged: own scarce, compounding assets, demand a margin of safety, and let time do the heavy lifting. The next decade will reward owners, not renters, of quality.
