Market Insights

Investing in Convertible Bonds With Attractive Risk/Reward Characteristics

The post was originally published October 10, 2019 and updated November 21, 2024. 

“We are attracted to the downside protection that a convertible security’s bond feature offers, while also offering the ability to capture a significant portion of the upside in the issuer’s stock, given the...

Prospector Election Impact on Banks

The contrasting views of Republicans and Democrats on banking regulations could be one of the starkest differences in the upcoming U.S. presidential election: Republicans believe in a more laissez-faire approach while Democrats favor a tighter regulatory environment.

Soft Landing or Mirage?

Editor’s note: The following was adapted from our 2Q 2024 Commentary

As the U.S. economy absorbs the most aggressive Federal Reserve tightening cycle in recent history, the historically elusive "soft landing" increasingly is becoming the base case for investors. While economic growth has...

Election 2024: Part 1 Parties, Policies, and Perspective

With less than three months before Election Day, the race for U.S. presidency is heating up.

Every election brings the potential for unknown outcomes and volatility. However, this cycle has already had more than its share—from a debate performance by President Biden widely viewed as so disastrous...

Pockets of Opportunity in Industrials

Updated version of original article from May 2023

At Prospector we evaluate all of our investments from the perspective of downside risk mitigation above all else. Across all industries, we target companies with strong, low-leverage balance sheets, dependable free cash flow generation,...

Digesting the Challenging Backdrop for Restaurant Fundamentals

We have a long history of investing in restaurants. And, while we are always discerning in our approach, we’ve become even more so recently.

We believe the combination of weak top-line growth, ongoing cost inflation, and weakening pricing power creates a difficult backdrop for near-term restaurant...

Without a Clear Victory Over Recession, Potential Pitfalls Remain

Between early 2022 and mid-2023, as the Federal Reserve aggressively raised interest rates in an effort to lower inflation, it caused significant uncertainty within stock and bond markets.  

Today, although the rate of inflation has subsided and the consensus appears to be that we have reached an...

A Surge in Weight-Loss Drugs Caused Investors to Lose Their Appetite for Food-Related Stocks in Q3

Much as artificial intelligence (AI) dominated headlines and investor mindshare earlier in the year, in the third quarter, the market became fixated on the impacts of GLP-1 drugs. These drugs (GLP is short for glucagon-like peptide) include Novo Nordisk's Ozempic and Wegovy, Eli Lilly's Mounjaro...

Unpacking the Implications: Rising Interest Rates and their Ripple Effects

The market seemed to grapple with a "higher for longer" interest rate environment in the third quarter. The benchmark 10-year Treasury rose significantly (from 3.81% to 4.57%), causing unease for investors, and contributing to the market’s decline during the period. Given the sharp rise in interest...

The Value Investor Toolbox: Private Market Valuation

Underneath the umbrella of value investing lies a variety of techniques that aim to identify mispriced assets. At Prospector, we heavily utilize two approaches in the value investor toolkit that we believe can add value in any market environment: private market valuation (PMV) and free cash flow...