Q1 2026 Equity and Fixed-Income Quarterly Outlook

Brandon Balazi:
Hi everyone. Thank you for taking the time to join us today for the quarterly update and market outlook from Saturna Capital. My name is Brandon Balazi. I'm the advisor Relations manager here, and I'm excited today to be joined by two members of our investment team. We have Will Jones, who is a part of the equity side of things, and the portfolio manager on the Saturna Growth Fund, and Elizabeth Alm, who is on the fixed income team and manages the Amana Participation Fund and the Saturna Global Sustainable Bond Fund. One quick note before we get started is we do have a Q&A as the webinar progresses. Feel free to put them in the chat box. We also left some time at the end, so you're more than welcome to wait towards the end to ask questions. I'm going to leave it on this screen for just a few seconds as we go over some just housekeeping items that we have to put up there. Okay. So I'm excited for this quarter's webinar because obviously there's a lot of headlines both in the financial markets and geopolitically. I thought I would start off with what's at the top of everyone's mind, which is the conflict in the Middle East. One thing that's unique about certain US approach is our boots on the ground approach is what we call. Elizabeth Alm was actually in the Middle East for a couple of weeks in February and had quite a trip meeting with issuers brokers, and I thought I'd turn it over to her to get an idea of the breadth of her visit and her commentary over what is going on right now and how she thinks markets are reacting. So, Elizabeth, if you don't mind, can you give us a few a little bit of background about your trip?
Elizabeth Alm:
Absolutely. Thank you so much. And thank you so much for everyone today to join our discussion about the markets. So that is something that's really unique about turn. It is our expertise in that region of the world. Members of our team have been visiting the Middle East for over a decade, and we've been managing the amount of participation fund for now, over ten years, focusing on the Middle East. And as part of our due diligence, I got back from a, 50 meetings in the region with issuers and brokers in the countries of Oman and then Dubai, Abu Dhabi, Kuwait, and also Saudi Arabia. I actually left the region about five days before the war. But one thing that really struck me about these meetings and about talking to issuers face to face, was just how strongly the financial position they were in before this war started. For example, in a lot of the GCC countries in which the amount of participation fund invests are extraordinarily well positioned financially. Just for example, Saudi has a wealth fund of over nine, sovereign wealth fund of over 900 billion. Abu Dhabi's is over 1 billion, in Kuwait is over a billion. And we see a lot of news headlines coming through. But it's really also important to note that these countries have an extraordinarily low debt to GDP. Abu Dhabi's, for example, is only 19%, Oman, which recently got upgraded to investment grade, last year it's only 36%. And even in Saudi Arabia, it's 31%. And this is compared to something like the United States, which has a much higher debt load of over 120%. So these issuers rated A and double A, they really do have excellent governance. And extraordinary financial flexibility. But also it's important to note that we have a lot of corporate meetings as well as part of this due diligence. And one thing that struck me from the corporate side of things is just how diversified a lot of the business operations are, and also the financial flexibility of a lot of these companies. For example, a lot of them have globally diversified business operations. One of the most notable site visits we actually went to do an on the ground visit to Dubai's main port, Jebel Ali. This is the world's largest manmade harbor. And the fund, the amount of participation fund owns one of the operators, the terminal operators within that port. And, you know, we see the news headlines and you could think there would be a huge impact. But just for example, the scared scale, this one operator is responsible for 10% of the world's, container throughput. They operate in 85 countries. So while there is exposure and while there are headlines, really our job is to have that due diligence, have that boots on the ground to understand what the potential impacts will be and what sort of financial flexibility these issuers and sovereigns have had going into this conflict. That will obviously have an impact on the region. But generally, we find it very helpful to get that breadth of knowledge. And, and we have been positioning the portfolio to be very conservative, through this volatility.
Brandon Balazi:
That's great. When you say conservative, just to give people on the on the webinar idea, give us an idea of what conservative means to, fixed income fund manager. 
Elizabeth Alm:
Absolutely. So our funds, both of our fixed income funds, the primary objective is capital preservation with a secondary objective of current income. And what we mean by conservative that we're focusing on issuers that can whether economic cycles that have financial flexibility so that they can go into a volatile environment and withstand some of the, let's say, revenue volatility that may result. It also entails being conservative from a technical fixed income perspective. So both of our funds are positioned, relatively short relative to their benchmarks, which means we have a lot lower interest rate sensitivity than a lot of our peers are benchmark. So, meaning, when the bond market moves, we really want to minimize the drawdown experienced by our clients for any of this volatility, to really honor that primary objective of capital preservation.
Brandon Balazi:
Great. I appreciate that. I thought I'd turn it over to Will right now and give Elizabeth a quick break. So we appreciate the overview of your trip. Elizabeth will, with everything that's going on right now, what are you seeing in the equity markets? How is it affecting both globally and domestic markets? 
Will Jones:
Yeah. Thanks, Brandon. It's, it's a pleasure to be on this call. And, thank you to everyone. On the other end, we look forward to taking your questions. You really can split the corridor between, the first two months and then and then march in sense with the with the onset of the war, it really change the tenor of, of equities. You know, going into that point, we had international and emerging market equities outperforming domestic, you know, much as they had during 2025. That shifted a bit. But generally markets came off. Of course there's very large, you know, global ramifications of the conflict with the, you know, near effective closure of the, the Strait of Hormuz. You know, obviously, the situation is very, very fluid. It looks like we're going into a period right now where, we're going to have a two week ceasefire and traffic's going to resume. So, you know, equities currently rallying on that. And there's been this big, you know, divergence between oil and equity prices. Just based on any given daily news flow. Equities have tended to trade inverse oil. And then there's all these you know, potential knock on effects given the conflict as well. You see energy prices go up that could bleed into, higher inflation higher inflation expectations. We are generally in this easing cycle across the globe with control, with central banks, you know, cutting interest rates depending on how things go that that may, may shift. And then there's also implications as far as things like freight costs that could weigh on corporate margins. Consumers could pull back if their cost of living increases. So, you know, all sorts of ramifications here. And, you know, I think for us, it's not about trying to necessarily predict exactly where this conflict is going is going to be in a month or so, but really to, I guess, use diversification with our portfolios as a key antidote and make sure that we are invested and in companies that we think can, really succeed in a variety of different outcomes. So that's about being and, resilient, adaptable businesses and all. I'll kind of stop there and, see where you want to go. Brandon. 
Brandon Balazi:
Yeah. Prior to the war starting, the big topic to start the year was software companies and kind of how they gave a lot of what their gains back were at the in 2025. So the question was, I have to Will, is software dead? 
Will Jones:
Yeah. It's a good it's a good question in something markets are wrestling with right now. We've seen, you know software be I believe kind of the worst performing, industry year to date. Many of these stocks are off about 50% from their, from their highs. I think software companies have given up something like $1 trillion and market cap. So really a striking sell off. You know, to answer your question, I think the quick version is no, software isn't dead, but there's going to be winners and losers. And what's really interesting about this environment, right now is the market doesn't know who the winners and losers are. And, you know, we certainly don't have the answers there as well. But we get really excited when you have a bunch of companies that are sort of grouped together and being treated homogeneously by the market, because we know that there's stronger hands and there's weaker hands, and we're, you know, as an investment team really focused on trying to, you know, get, I guess, get to the bottom of that in some of our portfolios. We've, started adding to, you know, companies that we think are or better positioned here. But, you know, it's something that we, we tend to move a little bit more, more slowly on and, and, or just trying to focus on kind of bucketing these, these companies into different groups. As far as do they have a product, that could be displaced by, I fear, you know, generating images for marketing or something like that per se. You know, we know I can do that pretty well. But if your, system of record that a ton of business applications run off of that are very, very difficult. We've seen historically to to replace. And there's also just a ton of different implications as far as do these business models change. Typically they're priced on a perceived basis. Are they going to move to a usage basis. You know, what are the implications for seats. So I you know, I think I think it's actually a really exciting time to, to be an investor and try to kind of better understand these dynamic dynamics and, and get to the bottom of it. But, now, no, software is not dead.
Brandon Balazi:
That's great. That's great. Posing a similar question to Elizabeth. You know, Elizabeth, what were you seeing in the bond markets in January and February and, and how has everything been impacted since the beginning of March? 
Elizabeth Alm:
I would absolutely echo Will's comments and that the quarter is divided into two distinct sections. There were there was a trends that were happening before the war started, and then really a fundamental shift in the bond market in our expectations after the war. Obviously, one of the main things driving the bond market in the quarter is the change in inflation expectations, as oil jumped to over $100 and everything from fertilizer to helium and sulfur have been disrupted by the closure of the Strait of Hormuz. And even with the ceasefire talk that's it still remains blocked. There was only six vessels in either direction that got through the strait, as of yesterday. So the inflation expectations really shifted upward and PCI inflation revised to around two and 2.7%. Eurozone inflation moved up 60 basis points in March, a pretty staggering rise. Especially, you know, the eurozone is vulnerable given the reliance on foreign energy imports. But the main shift in this was the change in monetary policy expectations going into 2026 and the first month of the year. Global central banks were pretty aligned in soft landing narrative, centered around two rate cuts penciled in for the year. European Central Bank was, pretty complete in their cutting cycle. And then like the Bank of England was set to continue reducing their rates in 2026. But this consensus is pretty much upended within days of the conflict. The fed holding steady with the market, not even pricing one, rate cut this year, the Atlanta Fed actually placed a 25% possibility of a hike. That figure would have been absolutely unthinkable in January. And then the ECB and, the Bank of England also changed their trajectories, with the Bank of England. Maybe even considering hikes. But all of this really, changed the, the yield curve. So the defining feature of this quarter was the failure of this, the typical safe haven trade. Usually when we see geopolitical shocks, it sends investors into sovereign bonds, safe bonds pushing yields down, but instead, we really did see bear flattening across all G7 countries. For example, ten year Treasury rose 30 basis points. So did the ten year German Bund. And in a pretty staggering move, the UK two year gilt rose more than 85 basis points. But I think on the top of a lot of people's mind is how has this affected the US dollars, the sukuk market and sukuk market has shown some widening, as you would expect, but not to the scale that we saw in 2022. And it's pretty interesting. The US dollars, the sukuk market on the whole, generally outperformed the global bond market since the beginning of the war. If you look at on a quarter, full quarter basis, it still shows a bit more negative returns since the beginning of the year. But this is primarily driven by currency movements at the beginning of the year. But what really struck me is that the history of the asset classes, moderate volatility and exceptional issuer quality is holding steady just looking at volatility. So sukuk are still showing lower vol than, for example, global bonds emerging markets or even U.S. treasuries. A lot of the sovereigns still have stable outlooks on their ratings. And just to note that around 80% of the market is rated investment grade and very resilient in terms of, the ability to absorb these shocks.
Brandon Balazi:
Do you think that the low volatility of the of the sukuks is, is a misconception amongst investors? Do you think that people shy away from it because the asset base are you know what or what is the biggest misconception right now in the in the bond markets from your vantage point? 
Elizabeth Alm:
Well, I think one misconception that I often, talk to our clients about is the, the assumption that global bonds automatically means high volatility. And within any market there is of course, there are of course, sectors within the sukuk market, within the bond market that are going to experience credit events and higher volatility. I think that onus is really on us as investors to identify those markets. For example, pricing on lower tier Dubai real estate developers have it's been quite volatile. The fund, definitely does not have exposure in a lot of those high beta names. A lot of the reason, because we were boots on the ground, we met with these potential issuers and deem them perhaps too risky to meet the objectives of the fund. So I think it really has to do with issuer quality. Also, just the structure of the sukuk itself, lends to lower volatility and the fact that we're focusing on shorter duration, which means lower exposure to interest rate volatility within the fund, that can help reduce some of those impacts on our clients. 
Brandon Balazi:
Okay. Appreciate that. Elizabeth. Switching gears back to Will, you know, I'm in the field all the time meeting with financial advisors and when people look at our equity holdings, one thing that usually comes up is in most of our equity funds, technology is the biggest sector or holding. Well, what are your thoughts to anybody who brings that up? Or is technology a sector that you just you guys like? And I've always liked given our long term approach, what are your thoughts.
Will Jones:
Yeah, it's a great question. And I think that's the case for, for a few reasons. You know, first and most simply, our, our investment approach tends to be towards, you know, very quality companies, durable business models and also low debt. Technology typically has, you know, a lower debt area. And then you have a number of companies that have really an incredible moat around their businesses. And what I think is unique about technology as a sector is not only can you can you carve out these, you know, incredible businesses with, you know, power laws where you kind of dominate your, your niche in, in the ecosystem, but because it's changing so fast, you have additional opportunities that that come up. And that's really what we see, I think with, with great companies is that you're, you know, you're on an ace growth curve and then you're able to kind of find a new one and leverage your, leverage your existing business into that. I mean, the I think the, the great. Well, I shouldn't say the greatest, but a very good example of that is, company that sold books online, creates an e-commerce platform, then creates a cloud platform on top of that. And then also within technology, you're able to get, you know, network effects that occur, which can be powerful and reinforcing over time. And that, that, that tends to create these incredibly, you know, durable positions, as well. So I think there's kind of a few layered reasons. And then maybe the last one that I would bring up is, you know, a lot of times you have very low, marginal cost of delivering your product so you can benefit from a ton of, you know, whether it's IP that you've developed over time or in, you know, the case of, like, semiconductor foundry, you know, all these fixed costs and expertise, you have a technology, but then producing that one incremental unit, is very low. So you get these kind of incredible economics that come along with, very strong and durable positions. 
Brandon Balazi:
That's great. You mentioned something that Elizabeth also mentioned, when she started off and that was low tech companies. And so I'll plug our, our one of our most recent whitepapers, we went over our core tenants is on the website. If anybody would like to go into it. It's something that it's attorneys for decades we've been focusing on as low tech companies, whether it's on the fixed income or equity side. So that's my cheap plug. A follow up I have for you will, is, we look at technology companies, we look at low tech companies. We also integrate sustainability into all of our strategies. So one question I always get from advisors is, is how is integrating sustainability, you know, a risk lens. How are we using it to reduce risk. 
Will Jones:
Yeah it's a good question. And you know sustainability you know means a lot of different things. We tend to you know, look at it in terms of, you know, I guess the business holistically and also consider risks. You know, for me one of the most important ones is just governance. You know, with all these companies, we are minority shareholders and it's very important that the company acts, you know, in the interest of minority shareholders. So it's things like, you know, in, in ensuring that, the incentives of, of management are in line with, with our incentives of minority shareholders. And then also just trying to, I guess, underwrite the, the composition and the quality of the board. So there are sufficient checks in place for, for management. And then, you know, beyond the governance side, which, you know, we could talk about for, for 20 minutes, you have things like, you know, how a company treats its employees, how they, three broader stakeholders in the community, what are the downstream environmental externalities, you know, and not only do these things, you create headline risk for the company that could, you know, bleed into the stock cause, you know, drawdowns, volatility or all those kinds of things. You know, I think one, one hallmark of, you know, great companies over time is that they give more than they take. And you don't want someone that's a zero sum, you know, actor whether it's to their customers. To, to their community. So, so it's really trying to, you know, look at this holistically and make sure that we have a company that has it has a long term focus. And that's treating, you know, everyone across its, its ecosystem with, respect and as a partner rather than just merely, transactional and kind of, a zero sum manner. 
Brandon Balazi:
That's great. That's great explanation. And then, of course, I mentioned the beginning. Elizabeth, you are a portfolio manager on our Global Sustainable Bond Fund. Would you echo Will's thoughts?
Elizabeth Alm:
Absolutely. I think he summed up our, corporate, process very well in the bond market. We also do have additional sector exposures that aren't seen in the equity market, for example, sovereign and some sovereign issuers. Also, for example, supranational banks, so I would say in addition to looking at corporate governance, looking at, climate impacts on corporate operations, there's an element of physical risk in the bond market that we, that we also consider. For example, if we're looking at municipal issuers in the United States, we are looking at how they are building resilience into their infrastructure, what sort of exposure they may have to physical climate events, storms, floods, etc., how demographic changes may impact their future tax revenue, for example. So, you assess in just how they're building out, you know, or compensating forest for the growth in population, etc. So I think that additional component of the bond market makes it unique. But at the same time, there's also a lot of direct contribution the bond market has towards, building resilience into the global economy. For example, we do invest a lot in the global sustainable bond fund in green bonds, social and sustainable bonds, sustainably linked bonds, which not only provide that positive impact, but just from a credit and issuer governance point of view. Also help the market in which we operate to be safer. But also, add a component of that. That word resilience comes up a lot in, to the corporation or the issuer themselves. 
Brandon Balazi:
Okay. That's great. And just a reminder to everyone, the Q&A. Some of these questions I, I've been firing off. But feel free to put stuff in the in the chat box if you have questions. Sticking with Elizabeth here, you know, talking about our portfolios in Q1, what were the primary drivers of fixed income performance over the last quarter? And how did they influence the fund performance? 
Elizabeth Alm:
Absolutely. First and foremost, really, was the duration, also known as the interest sensitivity of the portfolios? Both the sustainable bond fund and also the amount of participation fund are run with a sensitivity to interest rates, more like an intermediate category bond fund. So relatively short. Both were had an effective duration of under three and a half years, which is significantly lower than our benchmarks. So one distinguishing part of the bond market this past quarter is that what drove performance from a duration point of view really shifted? The last half of last year, you had the belly of the curve, that 5 to 7 year maturity range driving strong performance. But that completely shifted in the first quarter of 2026. You had long bonds, with a lot of sensitivity to this volatility. They underperformed with shorter bonds performing better. So the fact that we were conservatively positioned definitely helped us. I would say the secondary component, especially as it pertains to the significant outperformance of the sustainable bond fund relative to the overall global market, was the dollar strength? I think currency movements showed a drastic shift pre and post war. The dollar which had been selling off, gained a lot of strength in a lot of currencies depreciated relative to the dollar. So the bond fund is significantly overweight U.S. dollar relative to the global I. It was around 70% as of quarter end and also underweight the euro significantly, which we see possibly depreciating even more. In the fund was also overweight Colombian peso, which was one of the better performing currencies last quarter relative to the US dollar. And then finally, I would say credit is the third component. Strong issuers, as I discussed in the, the beginning part of this, you know, our discussion here, but also as it relates to the Sustainable Bond Fund, that the ability to have such a diverse market and choose high quality issuers globally, we're able to diversify not only our holdings, but also the economies in which our, issuers operate. And I really do think that sustainable overlay builds resilience, for example, to oil shocks, with focus on renewables and governance, etc.
Brandon Balazi:
Okay. That's great, I appreciate it. Elizabeth. Going to turn it, you know, talking about performance of the of the markets in the equity markets in general, you know. Well, for the months before the war took over, all of the headlines we were seeing, there was a lot of drawdown in indexes that had an overconcentration of the Mag Seven. It was somewhat where our, you know, strategies compared remarkably well. Are you thinking this is an unraveling trend set to continue, or do you see the Middle East events impacting this trend? 
Will Jones:
Yeah, I think I guess it's important to kind of consider what we think is causing that. So, you know, a number of these mag seven companies are they really have some of predominant, I platforms where they're investing very heavily in data centers and they're renting out, you know, that capacity to other, companies to, you know, either train models or run existing, you know, AI models and then also use it using them for, you know, themselves as well. And, you know, going into the year, several these companies told us this was in, kind of late January, told us how much they were going to spend on, on data centers, this year. And it was just as far beyond market expectations. And kind of since then, we've seen, you know, I guess this have been happening a little bit last year as well, but it accelerated. We've seen the multiples of these companies, you know, come in. They've underperformed the market. And I think, you know, one of the key reasons for that is that if you have a company that has, it more, I guess an asset, heavier business model, it creates more variability of their, of their earnings. You essentially you add more, you know, fixed assets, it creates more operational leverage and into the business. So it creates more earnings volatility. And the market tends to assign lower multiples to, to those businesses. So we think that's part of it. You know, the capital expenditure margins of some of these companies are getting up towards, you know, 50%. And you know, there's some I guess not mag seven, but other companies doing similar things that are, that are beyond that. So I think that's kind of, you know, weighed on them a bit. And then there's also this question of, you know, what the returns on these data centers are actually going to look like. We're still pretty early within this, technology transition that we're, that we're embarking on. So there's just kind of like a lot of questions as far as you know, the payback periods go and things like that. As far as how the, the, the war impacts this, I think it's kind of it's a bit, you know, too early to, to tell, but because of this dynamic and into your question, we have the, you know, large us, the main US indices, the large cap indices, that are very highly concentrated in these companies. So because of this dynamic, we've seen the equal weighted indices actually outperform these. And then it's, you know, generally good for active management when you have a broadening of, of performance. So it's something that, that our funds have benefited from. And I also think it's just important to underscore, diversification broadly that, you know, it can create more volatility in the, the indices as well as you have more, you know, concentration and, and in the top. So, you know, I think it's, it's something that we're, we're happy to see a bit of broadening, and I would, you know, I would expect to see these companies continue to do well in the future just because they have such strong, you know, market positions. But over the last few years, it's really been a market, you know, dominated by them. So I guess we see what, what's happening is healthy. 
Brandon Balazi:
Sure. And at the end of 2025 and going into 2026, international was a, you know, at least with advisors I talk with was at the top of their mind. And it was a very hot asset class. Do you think that that trend is going to continue? Is it all depend on what's going on in Iran? What are what are your thoughts around the international sector? Because as an equity manager and all of the saturnine amount of funds, we do have global, global exposure and both of the strategies. 
Will Jones:
 Yeah, it's a good question to 2025. I believe international equities outperformed us by the most since 2009. And so, so really a strong year for international. And you know, I think the broad expectation in the market was that that was that was going to continue. Markets certainly do have a way of surprising you, especially when, when there's kind of consensus on, on one side or the other, although we did see that, we did see that kind of continuing in in early 2026. But you're right that the, the war is a bit of a fly in the ointment here because international markets, you know, for the most part, are more dependent on energy imports than, than the US is. So for things like, you know, Europe also equal, this is a bit of a headwind to the industrial base. You know, for Asia, it also is a headwind to the industrial base. And so we have seen a bit more volatility. And in some of those markets as they kind of react to, to the, the, the news flow, you know, I think for us it's when we're, when we're investing internationally, you're going to have some beater in international markets with anything that you buy. But it's but it's less about, you know, for if we're buying like a semiconductor company in Taiwan, you know, it's, it's less a bet on Taiwan outperforming or Asia outperforming, but an indication of our belief in the sustainable business that that company, you know, operates in. And, and we think that, they will, you know, do well even if energy prices are higher. And, you know, in some sense, you have these businesses with great positions in their market, their input costs increase. It actually further distinguishes them from their from their competitors. Who are, you know, unable to kind of, handle adversity and, in the same way that, that they are. So, you know, for us, I don't think it's a situation where we're trying to scramble to change our international positioning whatsoever. I think we understand that you're going to have a little bit more volatility because of it, but our long term approach allows us to, kind of weather that volatility and not have to be, you know, trading around it in the way that, some other market participants have to. 
Brandon Balazi:
 Awesome. And, and plugging another one of our core tenants at the end there, long term investing, another whitepaper we wrote at the beginning of the year to cover one of our key tenants, long term investing, low debt investing. Following up to a similar question I asked Elizabeth is, you know, we talked about international. We talked about software companies. What were other drivers of performance? Is there anything we're missing from the equity market that that stuck out to you in Q1? And then any, any outlook? Into Q2 in the rest of the year that that's getting you excited?
Will Jones:
Yeah, it's a good question. You know, we talked about, the impact of the mega-cap companies, you know, we saw for a bit of, a bit of the quarter industrial companies doing well. And I think there's something that we've been excited about as we've been in this pretty sluggish industrial market for the past, call it 18 months, you know, something like that. There's been fits and starts there. But it's been it's been weak generally. And I think we came into this year thinking that things could turn around, a little bit there. You know, there's been, large reshoring impulse within the, the, the US. There's been a ton of construction. I think eventually we, we see that translating into more manufacturing activity. And then, and then there's been, you know, some aspects of recent tax legislation that allows, tax benefits from depreciation. So we also think that that probably causes more projects to, to, to pencil going forward. So, so that's something that we're, we're interested in kind of industrial companies that aren't, that aren't completely, levered to the, the data center story. Iran is, you know, it kind of causes companies to sort of, you know, maybe take a deep breath as far as what their what their plans were this year. But, you know, in the more intermediate term, I think we see the events in the Middle East as actually continuing some of these reshoring stories that had been going on within the US, Europe, I guess, across the globe since the, since the pandemic. I think everything that happens where supply chains become more, more gummed up and have their vulnerability illustrated it, it pushes, sovereign countries a little bit further in the in, I guess, into realizing the importance of just having increased redundancies. You know, and I'd say quickly, I think the last, last thing that we're excited about as well is just continual electrification trends. It's something that the globe is moving toward. And I think energy crises. I don't know if this is quite, elevated to the, the, the term of a crisis, but anything like this that illustrates, I guess, what can go wrong within energy, I think, pushes, the electrification trends further. So, so that's something we're also excited about.
Brandon Balazi:
That's great. Appreciate it, Will. Elizabeth, a similar question to you. You know, we have a few minutes left here as you look out to Q2 and the rest of 2026. What are your what are your thoughts? And is there anything that's getting you excited about how we could potentially go into the summer and the year? 
Elizabeth Alm:
Absolutely. Thanks for that question. I think in the bond market, just a lot of what we're doing is positioning for potential and future volatility. So really focusing on that capital preservation part of our objective. So we're keeping sensitivity to interest rates or duration. You know on the on the short side of where they have been. But also what really is getting me excited is that there are potential opportunities to enter in to issuers with relatively good or relatively, advantageous yield. So buying opportunities caused by this market dislocation, especially those that are perhaps, located in, places like the UAE or Saudi Arabia. And so, you know, some examples are in the renewable energy sector, there are some companies that are domiciled there but have international operations, where the revenue is diversified. And, you know, some of these very strong issuers who we see advantageous, you know, or opportunities to buy into these, these names at a good price, with the spread widening. So just, I think what gets me excited about is entering into these strong issuers globally and taking advantage of this market dislocation, but also, you know, keeping in mind that safety first, really in the bond market, you win by, you know, preventing that downside and trying to avoid things that go wrong. In terms of credit and, and also in terms of currency and some of those technical fixed income considerations. You know, I just think, things that we're keeping our eye out, you know, and expecting going into the next quarter, next, part of the year, really looking at inflation expectations. And I think that this disruption in the Strait of Hormuz has compounding impacts that we may not have seen yet. Where from everything from, you know, how fertilizer disruption could impact, you know, exports of food in the next part of the year? Just in terms of helium and sulfur, how that could impact other sectors and raise prices. So we're watching that closely. And, in trying to position the portfolio accordingly. 
Brandon Balazi:
Okay. And one of the questions that we got was and I think you kind of answered it with inflation expectations, was an example of an important indicator when gauging the health of the of the bond market, both globally and domestically. I think, you know, if you had anything besides the inflation expectations. 
Elizabeth Alm:
Absolutely. The bond market is pretty interesting. I look at it kind of like a mosaic, where there's not one indicator that you can look at to determine the health or the trajectory of the bond market, but rather we have to look at many, many different indicators. You know, everything from, you know, the market expectations for monetary policy or interest rate movements, the currency changes, one indicator that I've been looking at recently is the move index. It's basically the bond equivalent of the VIX looking at market volatility and just noting that while it has ticked up, we are still not at the you know we're we have less volatility than we saw at Liberation Day last year. So just in terms of what is impacting the bond market and how much it's reacting, we also haven't seen you know, we really do look at and how interest rates are moving in terms of credit quality. And one thing that we have not seen in this most recent disruption is that we have not seen that flight to quality that we have seen in other serious credit or economic events. So I think that would be maybe the second thing that we look at is and will look at in the future is how, interest rate movements are, are going, broken down by credit quality.
Brandon Balazi:
Now, great, we have a couple minutes, two minutes left here. I turn over to, you know, Will on the equity side of things. Are there any closing thoughts or anything that you want to leave our investors and advisors with? As they go about their day? 
Will Jones:
Yeah. Thanks. Thanks, Brandon. I think the, the thought that I would leave you with is that when we get into uncertain times like this, it's important not to, not to overreact and think long term. You know, for us, that looks like diversification across the portfolio. And we've said this a few times, but just really wanting to be invested in resilient companies that could actually use, and economic dislocation if this rises to that level as an opportunity to kind of strengthen their that their position. So I think it's, it's being risk aware and constantly, you know, reevaluating, you know, what's in the portfolio and, and ensuring that there is strong strategic positions. But, but not being in a situation where, you know, we feel like we have to get out of things because our, our companies aren't, you know, ready to, to, to weather whatever possible ranges of outcomes arise. 
Brandon Balazi:
That's great. And then Elizabeth in 60 seconds or less anything parting words before we move on. 
Elizabeth Alm:
Absolutely. Thank you. And I would definitely echo Will's. And, you know, the first part of that statement is, you know, not to move without thinking or to overreact or to move just based off of headlines. I would say that deep due diligence is, you know, by my parting thoughts is just the importance of looking past headlines into fundamentals and then investing through cycles. So not reacting to every bit of economic data. I would say just having, you know, faith in the process and, comfort in that we have been choosing these resilient companies of, you know, to focus on capital preservation for the past decades that we've been running these funds. 
Brandon Balazi:
Appreciate it. Well, well, Elizabeth, thanks for taking the time to talk with us today and everyone enjoy your time. Take care everyone.