Happy Holidays!
In this week’s letters,
– Stone Sentinel Capital on Investor Judgements and LLMs;
– Andrew Hill Investment Advisors on Equities and the Economy;
– Asia Frontier Capital on the Emerging Markets outlook;
– Elevator pitches for UBER; VST; QURE;
Quarter in progress: 8 fund letters of Q4 are live on our database!
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Q4 2025 INVESTOR LETTER SUMMARIES
- The wild lion hunts. Judgment matters. There are plenty of wrong judgments and failed hunts, but there is also nothing better than fresh prey. The zoo lion follows. Consistency matters. Expectations of predictable and human-friendly behavior are high, but food arrives like clockwork, unaffected by judgment and the volatile savannah. Unlike lions, investors have the liberty to decide which environment is best. This also means investors must know what kind of lion they are.
- There are many perspectives discussing the disorienting impacts of large language models (LLMs) and artificial intelligence (AI). One such view was articulated by Mr Guy Spier. In “The Golden Age of Value Investing Is Over”, he suggested that advances in LLMs make the acquisition of knowledge so much more accessible that original thoughts, long the advantage of value investors, would be commonplace and erode the edge of value investors.
Andrew Hill Investment Advisors
- Equities had a wild ride through 2025. In the first quarter of the year, stocks appeared to be “taking a breather” from their massive run in 2024. This digestion of gains was accompanied by expectations that tariffs would be implemented by the Trump administration. Expected tariff rates ranged from 10% to 20%.
- It was another banner year for commodities. Gold, which has been a material portion of client portfolios for nearly the entire year, has outperformed the stock market, rising 70%. Cryptocurrencies, on the other hand, did not have a good year.
- Overall, the economy remains resilient. Inflation appears to be under control, but the labor market may be stalling. A careful look into the details reveals a new and very troubling problem dubbed “the ‘K’ shaped economy”.
- We anticipate Bangladesh to turn the corner in 2026 after a few difficult years, both economically and politically. On the macroeconomic front, lower inflation in 2026 should lead to benchmark interest rates declining, which will be very positive for stock market sentiment.
- GDP growth in Georgia remains robust with the first nine months of 2025 reporting economic growth of +7.9%. We expect this trend to continue into the next few years, with Georgia expected to sustain GDP growth of 5% or more from 2026 onwards.
- S&P Global Ratings recently upgraded Mongolia’s sovereign rating because of accelerating output from the country’s mining sector linked to coal, copper, and gold production. Mongolia is forecast to grow its economy by around 5.5% over the next few years, which will be good for the companies the fund holds in the consumer and mining sectors.
Q4 2025 TICKER TREEMAP
This quarter’s treemap of mentioned tickers (by Count)
ELEVATOR PITCHES BY FUNDS
Uber (by The Wolf of Harcourt Street)
- I went a step further with Uber and added to my position for the third consecutive month.
- While Uber is now in a roughly 20% drawdown over the past two months, the fundamentals remain as strong as ever. The narrative that autonomous vehicles pose an existential threat to Uber has resurfaced, and this is where my view diverges from the market.
- I believe autonomous vehicles will evolve into a highly fragmented market with multiple winners rather than a single dominant player. In that scenario, Uber is well positioned to leverage its global distribution network and infrastructure.
- Vistra Corp. is poised for significant growth due to the increasing power demand driven by the AI boom. The company has raised its FY2026 adj EBITDA guidance, indicating strong future profitability.
- Despite recent market corrections, VST’s valuations have become more attractive, offering a compelling entry point for investors. The company’s strategic acquisitions and investments in energy generation, including solar and gas-fired plants, are expected to enhance its diversified energy capabilities.
- With a healthier balance sheet and robust capital allocation strategies, Vistra is well-positioned to deliver long-term value to shareholders.
- uniQure’s AMT-130 represents a transformative advancement in the treatment of Huntington’s disease, with the potential to alter the disease’s trajectory significantly.
- While the gene therapy space is capital-intensive and subject to regulatory scrutiny, uniQure’s robust clinical data and strategic pipeline development provide a strong foundation for future growth.
- The company’s ability to navigate regulatory pathways and secure approvals will be critical in realizing the therapy’s full potential.
HIGHLIGHT OF THIS WEEK
MEDIA APPEARANCES BY BSDs
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- DoubleLine is warning of a “brewing collision” in some developed economies as governments from France to the UK and Japan struggle to balance social demands against ballooning fiscal deficits.
- Longer-term borrowing costs for developed nations under the fiscal-social gun will likely continue to increase, so positioning in the shorter-term tenors and underweighting longer-term interest rates in strategies that allow for this activity make sense.
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- In this interview, Chanos breaks down why hosting GPUs is a commodity business with low returns and why the depreciation of AI chips (like Nvidia’s) creates a massive financial risk for companies like CoreWeave and Oracle.
- He also discusses the dangers of private credit, the accounting tricks at Live Nation, and why the “unprofitable” nature of today’s AI customers makes this cycle riskier than the Dotcom era. Recorded on December 11, 2025.
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- Well, I think first 25 was a great year, tough year for active managers to keep up, especially if you weren’t heavily weighted in the growth stocks that really led the market.
- And Salesforce is much more dominant than the companies that are getting acquired at 8 to 10 times.
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