| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | - | - |
Penn Davis McFarland delivered commentary on 2025's strong but volatile market performance, with the S&P 500 returning 17.86% despite significant headwinds. Tariff uncertainty created supply chain planning challenges, while the AI boom entered a debt-fueled phase with over $400 billion in tech company debt issuance. The Federal Reserve's return to quantitative easing through $40 billion monthly Treasury purchases signals underlying concerns about banking system health. Positive factors included regulatory easing in banking and energy sectors and tax benefits from the One Big Beautiful Bill Act. However, the administration's interventionist economic approach raises concerns about market interference. The firm is avoiding additional AI exposure given valuation risks and debt-based expansion concerns, instead focusing on undervalued market laggards in consumer staples and software trading near multi-year lows. With cash reserves available, the strategy emphasizes selectivity at current levels while preparing for more aggressive deployment during potential market weakness. OpenAI's rumored 2026 IPO represents a key catalyst that could either extend or end the AI hypergrowth phase.
Despite strong 2025 market performance, significant headwinds from tariff uncertainty and debt-fueled AI expansion create risks, while regulatory easing and tax benefits provide support, leading to selective positioning away from AI toward undervalued market laggards.
Hopeful that 2026 will be a less eventful year than 2025, but not counting on it. Expect to be selective at current time and more aggressive should the market weaken significantly.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jan 11 2026 | 2025 Q4 | COST, NVDA, ORCL | AI, Debt Markets, Fed policy, regulation, tariffs, technology, Valuations | - | AI boom entering new phase with tech companies turning to debt markets to fund infrastructure investment. Over $400 billion in debt issued by global tech… |
| Nov 13 2025 | 2025 Q3 | - | AI, Cloud, infrastructure, megacaps, semiconductors | EVO SS | AI enthusiasm is driving market exuberance, with trillions in projected infrastructure spend raising concerns about eventual overcapacity. The letter draws parallels to prior tech build-out… |
| Jul 27 2025 | 2025 Q2 | UNH | cash flows, inflation, Pricing Power, Quality, Resilience | - | The commentary focuses on owning high-quality companies that can adapt and grow through inflation, policy uncertainty, and economic volatility. Management emphasizes pricing power, cash flow… |
| Apr 30 2025 | 2025 Q1 | SFM | - | - | - |
| Jan 30 2025 | 2024 Q4 | - | - | - | - |
| Oct 30 2024 | 2024 Q3 | LLYVK, SIRI | - | - | - |
| Jul 30 2024 | 2024 Q2 | BA, CSCO, NVDA | - | - | - |
| Apr 30 2024 | 2024 Q1 | GS, ROIV | - | - | - |
| Jan 31 2024 | 2023 Q4 | - | - | - | - |
| Oct 30 2023 | 2023 Q3 | FTRE, LLYVK, MSFT | - | - | - |
| Jul 30 2023 | 2023 Q2 | MTCH | - | - | - |
| Apr 30 2023 | 2023 Q1 | - | - | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2025 Q4 |
AIAI has been integrated into RGA's research process through tools like NotebookLM, Gems in Gemini, and Claude Code. The firm views AI as a force multiplier for human judgment rather than a replacement, emphasizing the Kasparov Law principle. They believe the market narrative around AI displacement is swinging to unhelpful extremes, creating investment opportunities. |
Machine Learning Automation Software Productivity Innovation |
LiquidityManager extensively discusses liquidity challenges in African frontier markets, explaining how tight ownership structures and limited foreign participation restrict trading volumes. Notes that liquidity varies cyclically and structurally, with potential improvement expected as bull market develops and more investor categories participate. |
Trading Volumes Participation Structural Cyclical | |
Trade PolicyRecent tariff policies continued to negatively impact U.S. consumers and companies throughout the year. However, international companies have been finding new trade arrangements and growth opportunities, benefiting from shifts in global trade patterns as the new U.S. administration alters terms of international cooperation. |
Tariffs International Growth Cooperation Impact | |
| 2025 Q3 |
AIAI has been integrated into RGA's research process through tools like NotebookLM, Gems in Gemini, and Claude Code. The firm views AI as a force multiplier for human judgment rather than a replacement, emphasizing the Kasparov Law principle. They believe the market narrative around AI displacement is swinging to unhelpful extremes, creating investment opportunities. |
Machine Learning Automation Software Productivity Innovation |
| 2025 Q2 |
Resilience2025 tested the fund's thesis severely with a bankruptcy, major customer losses, and cyber-attacks, yet delivered 17.45% net returns. The manager emphasizes that edge comes from exploiting inefficiency rather than avoiding adversity, demonstrating portfolio resilience through active management. |
Adversity Active Management Drawdowns Volatility |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Nov 13, 2025 | Fund Letters | Jeff Helfrich | EVO SS | Evolution AB | Health Care | Casinos & Gaming | Bull | NASDAQ | buybacks, cashflow, dividends, Highmargin, iGaming, Livecasino, Moats, Regulation | Login |
| TICKER | COMMENTARY |
|---|---|
| COST | Costco and Amazon are perhaps the clearest examples |
| NVDA | AI bellwether NVIDIA's very strong set of earnings in late November helped the AI theme re-assert its dominance when investors breathed a sigh of relief following the results. |
| ORCL | Investor enthusiasm for Oracle's stock in calendar year 2025 was initially driven by several multi-billion-dollar contracts it signed with leading AI companies, including OpenAI and Meta. However, in Q4 sentiment for ORCL's growth prospects shifted to skepticism, as investors began to scrutinize the return profile of the substantial capital investments required to support the approximately $500 billion of contracts signed by Oracle. Given the widening range of potential outcomes associated with Oracle's elevated capital needs, we reduced our position in ORCL during Q4. |
| Ticker | Put/Call | Amount Bought | Shares Bought | % Change | Weight % |
|---|---|---|---|---|---|
| No Recent Buys Data | |||||
| Ticker | Put/Call | Amount Sold | Shares Sold | % Change | Weight % | Status |
|---|---|---|---|---|---|---|
| No Recent Sells Data | ||||||
| Industry | Prev Quarter % | Current Quarter % | Change |
|---|---|---|---|
| No industry data available | |||
