Q1 Performance Review - See What Worked, And What Didn't

An Eventful First Quarter Is Now in the Books

In the table below, we show the total return for a range of ETFs in Q1 across various parts of the equity market (both domestic and international) in addition to other asset classes.

Unsurprisingly, the single largest gain in Q1 came from oil as USO surged 84%. The next best returns were related to oil with the Energy sector (XLE) up 37.9% and broad commodities (DBC) gaining 29.5%. Elsewhere in commodities, gold (GLD) and silver (SLV), in addition to ags (DBA) all rose mid to high single digits. While gold was higher, “digital gold”, or Bitcoin (IBIT), had a rough quarter, falling 22.6%; the worst return of any asset in the matrix.

Turning to equities, the S&P 500 (SPY) fell 4.4%, but the equal weight version of the index (RSP) managed to gain 0.61%. Sector performance was mixed. Again, Energy saw a huge gain as did Materials (XLB), up 10.67%. Other more lightweight sectors like Consumer Staples (XLP), Industrials (XLI), and Real Estate (XLRE) were also higher.

On the downside, some of the more heavyweight areas like Tech (XLK), Consumer Discretionary (XLY), and Financials (XLF) all fell more than 7%. Large caps underperformed small and mid-caps and growth underperformed value. Internationally, most countries saw gains with the largest coming from Brazil (EWZ) as it gained over 20%. Meanwhile, India (INDA) fell the most with a 13.3% drop. China (MCHI), France (EWQ), Germany (EWG), and Italy (EWI) all fell in Q1 as well.

Looking at individual stocks, the Russell 1,000 had less than half of the index move higher in Q1 with the average stock falling 0.29%.

In the table below, we show the 25 top performers in the index during the quarter.

Memory stock Sandisk (SNDK) topped the list with a 194% gain as AI demand continues to bolster that industry. Another AI story that drove a 100%+ gain in Q1 was optical and photonic product manufacturer Lumentum (LITE), who also secured a $2 billion investment from NVIDIA (NVDA) in early March.

A similar name is Ciena (CIEN), which came in at the number four spot with a 78% gain. After the surge in energy prices in March, a number of Energy stocks also top the list like APA (APA), Texas Pacific (TPL), and TechnipFMC (FTI). Fertilizer manufacturer CF Industries (CF) is also a major winner of the post conflict period, landing it in the best performers with a 32% gain.

Turning to the quarter’s biggest losers, there were three names that got cut in half: Atlassian (TEAM), Flutter Entertainment (FLUT), and Kyndryl (KD). Two of these are software stocks (TEAM, KD) in the crosshairs of the “AI Doom” trade where investors are worried about business obsolescence, while Flutter owns betting-app FanDuel and is now down 66% from all-time highs made last August.