In our newest Bespoke Report sent to Bespoke subscribers last Friday, we analyzed the stock characteristics that drove performance in Q1 2023.  Along with characteristics like valuations, short interest, and analyst ratings, one of the biggest things to impact performance in Q1 seemed to be how a stock performed during the downturn we saw in 2022.

Taking a closer look, in the chart below we’ve broken up the S&P 500 into deciles (10 groups of 50 stocks each) based on how stocks performed in 2022.  Decile 1 contains the 50 stocks that performed the best in 2022, decile 2 contains the 50 next best, and so on and so forth until you get to decile 10, which contains the 50 stocks that did the worst in 2022.  As shown below, the three deciles containing the 150 best performing stocks in 2022 all averaged declines in Q1.  On the flip side, the stocks in the decile containing the worst performers in 2022 averaged a huge gain of 16.8% in Q1 2023.  Q1 really was a mirror of what we saw in 2022.  Investors that looked at their portfolios at the end of 2022 and decided to shift out of the year’s losers and into the year’s winners only ended up feeling more pain in Q1.  The correct approach would have been to shift out of last year’s winners and into last year’s losers.

With Q1 2023 now in the books, below is a table of the S&P 500 stocks that gained the most over the first three months of the year.  NVIDIA (NVDA) came out on top with a gain of 90.1%, followed by Meta (META) at +76.1% and Tesla (TSLA) at +68.4%.  Other notables on the list of winners include Salesforce (CRM), General Electric (GE), First Solar (FSLR), GE HealthCare (GEHC), Arista Networks (ANET), Wynn Resorts (WYNN), FedEx (FDX), and Royal Caribbean (RCL).

The list of the first quarter’s biggest losers in the S&P 500 is made up of plenty of banks that got caught up in the deposit flight that ultimately took down SVB (SIVB) and Signature Bank (SBNY) — which were also both in the S&P 500 before their abrupt removals in mid-March.

As we move into April and the start of Q2, give our newest Bespoke Report a read for an analysis of how the market is positioned for the months ahead.  You can read the Bespoke Report and everything else we publish on a daily basis with a new Bespoke All-Access membership.

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