It had been hoped that going through the first 2 volatile quarters this year, the financial market would demonstrate some signs of stability in the third quarter. And indeed we had a short-lived rally that started in mid-June and ended in mid-August. However, taking a more cautious stance, we took that opportunity to exit certain positions at a better price during that period in anticipation of potential opportunities that might come available.

We felt vindicated by the events that transpired during the third quarter. To name a few, the intensifying geopolitical tension brought on by the US placing restrictions on the sale of some advanced technology, especially in the space of Artificial Intelligence and Semiconductors to China (and this might just be the beginning), the disruptive Zero-Covid policy in China, and all the foregoing just added into the negative sentiment in financial markets that were already grappling with monetary policy tightening by central banks across the globe in their fight against inflation (The Fed alone had increased 300 bps of Fed Funds rate in just 9 months of this year!). And yes, on top of that the shooting war in Ukraine has shown no sign of ending.

Amidst this uncertainty, we cautiously took advantage of opportunities to buy more of our favorite companies in emerging technologies such as artificial intelligence, synthetic biology and precision medicine, cloud computing, and fintech. Despite the current pessimism in the market, we remain optimistic that the ingenuity of humanity spearheaded by these technologies will create a better and more sustainable future for all mankind.

Sun Tzu said more than 2500 years ago in The Art of War, “In the midst of chaos, there is also opportunity.” Just over 20 years ago, during the dot.com bubble that erased more than 80% of the Nasdaq index, Amazon.com Inc. rose from the ashes to become the trillion-dollar company that we know today. We believe that we are well-positioned to capture that same kind of opportunity again today.

Sep 2022