Silver Beech Capital, a value-oriented investment management firm, released its first-quarter 2026 investor letter.
A copy of the letter is available to download here
Since its inception, Silver Beech has achieved a net annualized return of 16.4%, representing an annualized outperformance of 4.0% over the S&P 500. The fund returned -2.0% through the first quarter of 2026, compared to the S&P 500’s -4.33% and the Russell 2000’s 0.9% YTD returns. A sharp underlying divergence in the market was driven by the disruptive impact of artificial intelligence on business models and the disruption of global energy supply chains due to the Iran war.
Capital rotated toward perceived beneficiaries, with semiconductors and oil & gas exploration companies appreciated by 28% and 35%, respectively, while software fell by 24%. Many equity prices are now disconnected from fundamentals. In this backdrop, the Fund continued to focus on investing in undervalued companies less reliant on uncertain macroeconomic or geopolitical shifts.