Market Commentary | March 20, 2026

Mitigating Volatility

REITs won in February. As blind enthusiasm for everything AI evolved into a sober consideration of Return on Invested Capital (ROIC), investors began recycling funds from nose-bleed tech valuations into bread-and-butter staple valuations, including REITs and infrastructure assets.

Since its founding, 2MC has been focused on identifying and strategically investing in value. The market pounding that even blue-chip value companies suffered at the close of last year brought large-cap issues like Americold (COLD) and VICI Properties (VICI), previously too expensive to meet our investment criteria, to irresistibly low prices. We know these companies well, admire them, and plunged into what we perceived as exceptional entry pricing.

February’s end marked the conclusion of earnings season, and investors were not disappointed. REITs largely met or exceeded earnings expectations and provided encouraging forward guidance; an otherwise anxious market responded with 5%, 10%, even astounding 15%! share price appreciation on reporting days. Our new investments were paying off.

Then, at the start of March, something changed. The war in Iran and the resulting turmoil in oil markets created new waves of anxiety and doubt in the financial markets. Interest rates rose, stocks dropped, and fundamentals gave way to fear. All of the optimism stemming from earnings reports evaporated, and stocks started to trade independent of fundamental values. Without related news, prices of certain issues fell while other issues, inexplicably, rose (even disparate price performance in issues from the same company).

Such extreme volatility can be stultifying, but with our unwavering vigilance of the whole REIT universe, we have sprung into action. To free up cash, we have sold issues whose price defied gravity and bought those that, unwarranted, fell through the floor. For taxable accounts, we have temporarily deployed our favorably priced margin capacities to secure opportunities.

Volatility (price decline) offers immediate pain, but, with careful execution, poses potential for meaningful gain. We remain confident that the world will regain some stability, and fundamentals will return. In the interim, we’re at our desks trying to minimize risk and capture value.

Thanks for your continued participation.

Notes and Disclosure

Articles are provided for informational purposes only. They are not recommendations to buy or sell any security and are strictly the opinion of the writer. The information contained in these articles is impersonal and not tailored to the investment needs of any particular person. It does not constitute a recommendation that any particular security or strategy is suitable for a specific person.

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Past performance does not guarantee future results. Investing in publicly held securities is speculative and involves risk, including the possible loss of principal. Historical returns should not be used as the primary basis for investment decisions. Although the statements of fact and data in this report have been obtained from sources believed to be reliable, 2MCAC does not guarantee their accuracy and assumes no liability or responsibility for any omissions/errors.

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