Happy Friday!
In this week’s letters,
– Equity Management Associates on Trump, Economy, Gold & Silver;
– Greenlight Capital on gold and market valuations;
– GMO on AI Bubbles and its patterns;
– Elevator pitches for AON; TOI CN; VLE CN;
Quarter in progress: 623 fund letters of Q4 are live on our database!
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Q4 2025 INVESTOR LETTER SUMMARIES
- Trump Watch: Run It Hot! – Uber Dove Fed Chair is on deck. Big Beautiful Bill and Defense spending stimulus projected now to increase deficits by hundreds of billions of dollars.
- Monetary Chaos: Secular Trend Change – 10 Year US Treasury Yields are spiking higher breaking a 45-year trend of lower rates. Markets can smell the inflation.
- Gold – The ultimate form of money as it is geologically constrained and cannot be debased. Investors have NOT missed this bull market; we are still early. Historical norms suggest gold could achieve $8,000-$10,000 an ounce over the next few years.
- Silver – Physical demand for silver is outstripping supply massively. Silver prices are skyrocketing as prices are being set by physical delivery markets (Asia) and no longer the paper markets of New York (COMEX) or London (LBMA). We are just getting started. The Silver Miners have a long way to catch up given their profit margin outlook is far greater than Wall Street understands.
- We think gold benefited because the United States is losing some of its hegemonic leadership. The U.S. has also demonstrated meaningful counterparty risk through actions such as freezing Russian reserve assets. In addition, unstable tariff policy has increased uncertainty for other countries. As a result, many countries are trying to reduce their exposure to dollars for both reserves and trade.
- Notably, it appears that gold is being re-monetized through official government channels. That outcome is what many in the bitcoin community expected would happen for bitcoin. We are still not sure what the Fartcoin crowd thought would happen.
- From a top-down perspective, we remain concerned about market valuations. We believe the U.S. equity market is the most expensive we have seen since we began managing money, and it may be among the most expensive in U.S. history. Our concern is not limited to AI-related stocks, because speculative behavior among retail investors is clearly visible across the market.
- AI is a fast-moving and awe-inspiring invention that seems highly consequential, and even world-changing, to almost everyone, myself included. It affected what was then a deflating market like a multi-stage rocket.
- There have been countless technology bubbles over the past couple of centuries. They have ranged from the British railway mania of the 1840s to the SPAC bubble of 2020 and 2021. As a rule of thumb, the more revolutionary the innovation, the greater the accompanying bubble.
- Bubbles can have long tails. Cisco, the leading provider of internet equipment and briefly the world’s most valuable company, took a quarter of a century and another technology bubble to regain its prior peak. Today, Nvidia is the world’s most valuable company. Its market capitalization currently exceeds the entire Japanese stock market.
Q4 2025 TICKER TREEMAP
This quarter’s treemap of mentioned tickers (by Count)
ELEVATOR PITCHES BY FUNDS
Aon PLC (by Ironvine Capital Partners)
- Aon operates a capital-light, largely recurring revenue model by advising clients on insurance placement without underwriting risk. As organizations grow more complex, demand for sophisticated risk management increases.
- Aon is benefiting from restructuring efforts and synergies from the NFP acquisition, which should drive free cash flow growth. At a modest forward multiple, we see attractive risk-adjusted returns.
- The firm is also seeing significant growth in its health and benefits segment, bolstered by research into GLP-1 medications that reveals long-term employer cost savings and health improvements.
Topicus.com Inc. (by 8th Wonder Investments)
- Topicus is the European counterpart to Constellation Software and combines disciplined acquisitions with organic product creation. Operating in highly fragmented and regulated European software markets, Topicus benefits from local expertise, high switching costs, and recurring revenue.
- Since its spin-off, the company has compounded revenue at over 25% annually through a mix of bolt-on acquisitions and organic growth.
- With strong management alignment, high free cash flow conversion, and a vast runway of potential targets across Europe, we view Topicus as an earlier-stage version of Constellation with an even longer growth runway.
Valeura Energy (by Focus Capital Management)
- Valeura Energy is a Canadian oil company with a collection of producing oil fields in the Gulf of Thailand. During 2025, the company approved a highly attractive redevelopment of its Wassana field, adding reserves and extending field life with expected IRRs of roughly 40% even at $60 oil.
- Valeura also entered a farm-in partnership with PTTEP, expanding its acreage position by nearly nine times at a modest cost. Despite a 20% decline in oil prices during the year, Valeura remained highly profitable, ending the year with increased net cash after funding capex, taxes, and buybacks.
- The company has no debt and breakeven oil prices in the mid-$40s.
HIGHLIGHT OF THIS WEEK
MEDIA APPEARANCES BY BSDs
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- On investor pain and behavior – “Losses hurt. They’re not supposed to. You’re supposed to just do the rational strategy and keep repeating, but we live in the real world.”
- On meme stocks and gambling culture – “I’m fairly convinced there are a lot of—I’ll use the term investors, but there should be air quotes around this—who can’t distinguish FanDuel from Robinhood. It’s just an app.”
- On private equity ‘volatility laundering’ – “Private equity is a levered active equity portfolio that they’re just not marking. Volatility laundering is when public credit moves around a lot, but private doesn’t—it’s just madness.”
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- My central investment theme now for about two years has been center your portfolio positioning around the idea that the dollar is going to be secularly weak, even if the economy weakens.
- One of the things I’ve learned in over 40 years in this business is that the hardest thing to do when you’ve got a really good investment thesis is to decide when to change it.
- What we see as a safe haven appears to be tangible assets, obviously gold and silver, not Bitcoin…people are starting to look for things that are real and getting more sober about things that are hype.
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- Founded by billionaire investor Daniel Loeb, Third Point is preparing to nominate several directors to CoStar’s eight-person board, the hedge fund said in a letter to the board that was made public on Tuesday, confirming earlier reporting by Reuters.
- Loeb has said the majority of CoStar’s directors need to be replaced to help cut costs – including the CEO’s compensation – and focus on boosting the share price, according to the letter.
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