Strong YTD performance, higher total returns with lower volatility. Market climbs "Wall of Worry" amid recession fears, rising rates, inflation, and geopolitical risks. Value stocks rebound as quality companies regain favor. Portfolio changes include Mosaic and Nutrient acquisitions, Cigna and Aflac sales, and Schwab purchases. Sector weightings and valuation metrics remain favorable.

Year-to-date performance has been strong, outperforming the benchmark w/ lower volatility. Economic data surprises & rising interest rates have impacted market sentiment. Value sectors have underperformed, while tech stocks have shown strength. Overall, the portfolio continues to seek long-term outperformance through quality, profitability, and reasonable valuation.

The DH Smart Value Portfolio continues to invest in companies producing excess returns through positive economic profitability, supported by solid balance sheets (quality), significant cash generation (profitability), and trading with considerable margins of safety (valuation). We believe these factors will continue to provide rational opportunities for the foreseeable future. Using our consistent and differentiated investment approach, the DH Smart Value Portfolio is focused on outperformance, seeking higher total returns with lower volatility.

We note that 2022 was a year for the record books. For example: 1) U.S. financial markets were buffeted by the most aggressive monetary tightening cycle in 40 years. 2) It was the worst year on record for the Bloomberg Barclays U.S. Aggregate Bond Index (down -13.1%). 3) Long-term U.S. Treasurys declined -29.3%. 4) It was only the sixth time since 1926 that both stocks & bonds declined same year.