Core Viewpoint - Bank of America indicates a significant shift in market dynamics, suggesting that the traditional safe-haven role of bonds has failed, leading to a re-evaluation of investment strategies [1][4]. Group 1: Bond Market Analysis - The chief equity strategist at Bank of America, Michael Hartnett, describes the first half of the 2020s as a period of "bond-market humiliation," with long-duration government bonds experiencing unprecedented losses [1][5]. - The iShares 20+ Year Treasury Bond ETF, representing long-duration bonds, lost 31% in 2022, marking one of its worst years, with a maximum drawdown of nearly -47.8% from its peak in 2020 through late 2025 [2]. Group 2: Investment Shifts - Hartnett anticipates that the latter half of the decade will favor international stocks, emerging markets, commodities, and gold, driven by a weaker dollar and overseas reflation [3][5]. - The U.S. Dollar Index has decreased by 9% over the past year and nearly 2% in the last five days, indicating a trend that may benefit international investments [6]. Group 3: Market Leadership Changes - Bank of America warns that the traditional market playbook is failing, suggesting that investors need to adapt to a new foundation for their portfolios as bonds lose their safe-haven status [4]. - The focus may shift from AI stocks, which have dominated attention recently, to small- and mid-cap stocks due to trends in reshoring and industrial rebuilding [3].

Core Insights - The SCCM Small Cap Value Equity Strategy reported a strong performance in Q3 2025, with a gross return of 14.4% and a net return of 14.2%, outperforming the Russell 2000 and Russell 2000 Value indices which returned 12.4% and 12.6% respectively [1] Company Overview - Quaker Chemical Corporation (NYSE:KWR) is recognized as a global leader in industrial process fluids, lubricants, and specialty chemicals, serving various industries including metalworking, steel, automotive, and aerospace [3] - The company has a market capitalization of $2.368 billion, with its stock closing at $136.15 per share on November 24, 2025 [2] Performance Metrics - Quaker Chemical Corporation experienced a one-month return of 2.48%, but its shares have declined by 13.72% over the past 52 weeks [2] Business Model and Strategy - Quaker Houghton has established a resilient business model characterized by high customer retention, strong pricing power, and disciplined execution through economic cycles [3] - The management effectively navigates raw material volatility while expanding margins through operational efficiencies and innovation-driven product differentiation [3] Market Position and Growth Potential - The company's exposure to industrial production, infrastructure investment, and reshoring trends positions it to benefit from a sustained recovery in global manufacturing [3] - Continued penetration in international markets, especially in emerging economies, along with prudent capital allocation and sustainability initiatives, supports durable earnings growth and attractive long-term compounding potential [3] Financial Health - Quaker Houghton boasts a strong balance sheet and solid free cash flow generation, which, combined with expanding strategic partnerships, positions it as a high-quality franchise likely to outperform in the next phase of the economic cycle [3]