The voting machine

Benjamin Graham famously described market behavior with his well-known analogy: “In the short run, the market is a voting machine, but in the long run, it is a weighing machine.” Today, uncertainty—driven by the bold, disruptive, and at times erratic decisions of the Trump administration—has ended a period of calm in financial markets, placing significant strain on last year’s most popular trades. The Nasdaq has fallen over 10% from its recent highs, officially entering correction territory, while the once-mighty Magnificent Seven stocks have slipped below their 200-day moving averages. Meanwhile, former market underdogs are showing signs of resurgence—MSCI Europe, for instance, is up 10% year-to-date. At ECP, we focus on businesses, not just stock prices. We invest in solid companies at reasonable valuations, rather than trying to second-guess policy shifts from Washington, Brussels, or Berlin. Our priority is understanding value: Why does NVIDIA trade at only 24 times earnings while Novo Nordisk trades at 22 times? And why is Rheinmetall now at 55 times forward earnings despite the fact that the company cannot, in our humble opinion, add enough production capacity to grow into its multiple ? In times of uncertainty, we act decisively. As we speak, we are putting capital to work in select investment opportunities—because that is how we navigate markets, regardless of short-term turbulence.