Thinking about the past year at Crewcial, a John Lennon quote keeps coming to mind: “Being honest may not get you a lot of friends, but it’ll always get you the right ones.”

Clients can leave for many reasons, but performance is usually the catalyst. How that performance is experienced, however, often depends on the quality of the relationship: the clarity of materials, how discussions are handled, whether advisors connect with committee members, and whether answers inspire confidence. When those elements are strong, clients are more likely to stay committed through periods of underperformance. When they aren’t, tolerance for lagging results tends to disappear quickly.

That isn’t new. What feels new is the intensity. I’m reminded of a conversation in 2019 with a former client’s investment committee chair who told me he felt personally embarrassed that the portfolio had underperformed while he was in that role. For context, the institution had its own CIO, and the portfolio had materially lagged peers due to large non-US and value exposures, exposures that had delivered exceptional results just two years earlier.

What troubled me wasn’t the disappointment, but how performance became personalized. When that happens, emotional responses accelerate and time horizons compress. Add to that the fact that our approach increasingly requires clients to be different from the crowd (always a difficult ask) and the presence of financial advisors on committees who are, by choice or mandate, implementing the very strategies we believe carry serious long-term risk. We make people uncomfortable, sometimes because they sense we’re right, and sometimes simply because no one likes being told they may be making a mistake.

All of this is, in a sense, inevitable. Yet with each passing month, doubt naturally creeps in. Maybe this time really is different. Markets do feel different. Very little capital today is allocated towards the intermediate- to long-term, business-quality and valuation-driven strategies we favor.

If no one cares about fundamentals, why would they ever work?

And yet, as Mark Twain famously observed, “The report of my death was an exaggeration.” The same can be said for fundamentals. What we are seeing instead are market prices deviating from fundamentals to an unusually large degree. That is not a problem; in many ways, it is a gift.

Markets have become more extreme, not more broken. Hyper short-term investors, including many large multi-strategy platforms, are a dominant force today. They are not naïve; they understand fundamentals perfectly well, but they also understand crowd behavior and are willing to exploit it. They may hold overhyped names to capitalize on speculation, but they are just as willing, and increasingly quick, to rotate into areas that are deeply undervalued and fundamentally compelling. When that happens, the rotations are violent, and they reward patience.

This cycle has been extraordinarily difficult for our approach, but the larger story is our refusal to abandon a responsible, durable strategy simply because it fell out of favor. That refusal now presents its own challenge: maintaining resolve and resisting compromises designed primarily for comfort.

Those tend to take two forms. The first is giving in to pressure to “de-risk” relative performance by drifting closer to the index. We’ve been selectively guilty of this. It may pacify concerns temporarily, but it creates a lose-lose outcome. Clients eventually ask why they didn’t perform as well as others, while the very differentiation they sought disappears.

The second is declaring victory too early. If a portfolio outperforms by 500 basis points over a year and we rush to index-like positioning to lock it in, we miss the point. It’s worth remembering that during the 2000-2002 period, our approach outperformed by over 2,100 basis points during the S&P 500’s decline, and nearly 4,400 basis points over the following 13 years. Against that backdrop, 500 basis points is only a beginning, not the destination.

If anything, we should be more optimistic today than in past cycles. Mispricings are more pronounced and we are far better investors than we were decades ago. Truly meaningful outperformance over the next decade is a realistic, and in my opinion highly likely, outcome, but achieving it depends on remaining disciplined and staying true to our approach.

This requires resisting the temptation to compromise the strategy along the way. Clients who capture only a fraction of what’s on offer because we diluted the strategy will have missed something that cannot be made right after the fact. Our responsibility to our clients and one another is to deliver the full benefits of our approach; that is what produces truly mission-changing outcomes. There are limits to how much short-term discomfort we can ask clients to bear, but we should be careful not to set that bar lower than it needs to be.

We often focus on what went wrong, such as underperformance, lost clients, or missed opportunities. But when we step back and look at our team, the quality of our work, and the long-term outcomes we’ve helped deliver, there is a great deal to be proud of. None of it happened by accident. It was the product of creativity, discipline, and sustained effort across the firm.

As we look ahead to 2026, the challenges we face are not about to vanish. But if I told you we were on the cusp of one of the strongest relative performance periods in our history, would the current struggles feel different? Would it be easier to enjoy the process rather than fixate solely on the destination?

As Kevin Kelly once wrote, “The chief prevention against getting old is to remain astonished.”

I’ll admit that I often forget to do that myself. It’s easy to let the weight of the world dominate the day. But if we stay attentive, opportunities to be astonished, or even joyful, do present themselves. And those moments remind us why we do this work in the first place: to steward capital with clarity, courage, and patience, in service of missions meant to endure long after any single market cycle runs its course.