Patient Capital Management is a Baltimore asset manager founded in 2020 by Samantha McLemore, CFA — Bill Miller's long-time co-manager (working together since 2002, running the flagship Opportunity Equity strategy since 2014). Continuing the Miller-school contrarian tradition, it practices "time arbitrage": exploiting behavioral mispricing to concentrate in controversial growth names (tech, healthcare, Bitcoin-related) at deep discounts to intrinsic value. Its site preserves Bill Miller's complete 1995-2022 market letters, alongside ongoing quarterly letters and webinars.
This report reviews Q3 2026 markets. The author (patient_capital) sees sharp divergence: energy surged 17% on oil above $100, while utilities and small-caps slumped. Inflation eased but consumer confidence fell to 48.1; the Fed hiked once. Key holdings: Energy ETF (XLE) jumped 17% on oil spike; long-term Treasuries (TLT) dropped 8.9% as yields hit 5%; Bitcoin rebounded 42.6% to $83,600, ending three quarterly losses.
At a Glance In the third quarter of 2026, the overall market trended upward, with the S&P 500 rising 2.3% and the Nasdaq Composite Index gaining 2.6%, both reaching new all-time highs. The energy sector led gains with a 17.2% increase, driven by crude oil returning above $100 per barrel amid escalat
The S&P 500 rose 2.3% and the Nasdaq gained 2.6% in Q3, both hitting record highs, but sector divergence was pronounced. The energy sector surged 17.2% as the Iran conflict escalation pushed crude oil back above $100 per barrel; information technology and healthcare advanced 7.2% and 6.5%, respectively. Utilities plunged 12.4%, their worst quarterly performance since Q1 2020. Large caps outperformed small and mid caps, with the Russell 1000 up 1.8% and the Russell 2000 down 7.2%. Value stocks regained leadership, with the Russell 1000 Value Index rising 2.6% versus a mere 0.9% gain for the Growth Index. Bonds were weak, with the Bloomberg Aggregate Index falling 3.5% and long-term Treasuries dropping 8.9%. WTI crude soared 30.1%, bringing its year-to-date gain to 57.5%; Bitcoin ended a three-quarter losing streak, rebounding 42.6% to $83,600.
The macro environment is complex: inflation came in better than expected, but consumer confidence continued to deteriorate. Core PCE held at 3.0% in August, the unemployment rate stood at 4.1%, and nominal GDP reached 6.3%. However, the University of Michigan Consumer Sentiment Index fell to 48.1, while retail sales still grew 1.2% month-over-month. The 10-year Treasury yield broke above 5%, the highest in nearly two decades; mortgage rates returned above 7%, and housing starts and permits declined in August. The Fed unanimously raised rates by 25 basis points to 3.75%-4.00%, the first hike since 2023. The market is pricing in one more rate hike this year, but weaker-than-expected PCE data has reduced the likelihood of an October move.