Key Highlights
- While investors balanced AI enthusiasm, economic uncertainty, and monetary policy concerns.
- The summer rally was driven by AI-related spending and economic resiliency, whereas the fourth quarter saw a more volatile market due to valuation pressures and macro uncertainty.
- Stocks from the large-cap technology and communication services sectors led the market in the quarter, with the S&P 500 Index rising 2.66%.
- The firm believes that the trend of AI stocks outpacing high-quality stocks is unsustainable.
- In Q4 2025, Fenimore Small Cap Strategy returned -4.12%, trailing its benchmark, the Russell 2000 Index’s 2.19% return.
