The curated database of hedge funds that publish investor letters. Research by geography, strategy, and schools of thought.
| # | Fund | Strategy | Style | Geography | AUM | Latest Letter |
|---|---|---|---|---|---|---|
Arauca Capital compounds capital through an active, hypothesis-driven approach that pairs high-quality, mispriced compounders with macro-aware risk management and valuation discipline. During the first half of 2026, the fund generated a gross return of 25.26%, driven by significant multi-bagger gains across technology and artificial intelligence holdings, including successful exits in Kioxia, Shelly Group, and synthetic options positions in Alphabet, alongside sales in AST SpaceMobile and Vitalhub. Arauca has transitioned a large portion of its portfolio into short-dated government bonds and cash, creating substantial dry powder as the artificial intelligence landscape transitions from early free-optionality into peak-cycle enthusiasm and capex intensity. The manager identifies power availability and behind-the-meter infrastructure as key bottlenecks for AI, while establishing a new core long position in VersaBank to capture high-margin, zero-credit-loss point-of-sale loan growth in the United States alongside tokenized deposit optionality. Key macro risks include expanding United States fiscal deficits, persistent inflation paired with long-end Treasury yield suppression, and cyclical memory oversupply.
Capital is protected and compounded by investing in mispriced businesses where fundamentals inflect ahead of market recognition, while maintaining the strict discipline to exit when extreme valuations discount permanence in cyclical or rapidly evolving industries.
Arauca Capital expects financial markets to face growing friction as massive AI capital expenditures compress free cash flow and supply responses catch up to cyclical industries like memory. Policymakers attempting to suppress long-end government bond yields despite above-target inflation risk triggering broader fiscal and currency instability. The fund intends to maintain substantial dry powder in short-term Treasuries and gold while opportunistically deploying into niche corporate turnarounds, Texas private power campuses, and governance-driven mispricings in South Korea.
As of Sep 1, 2026
Jean Philippe Tissot is the Founder and Fund Manager of Arauca Capital with over 18 years of professional experience in the financial industry and treasury departments of world-renowned firms including BNP Paribas, J.P. Morgan, and Adidas. He successfully managed his and his family's capital for more than seven years, compounding at an annual rate of 27% prior to setting up Arauca. Jean Philippe's total track record over ten years is 18.5% CAGR. He holds an Executive MBA jointly from ETH Zurich and the University of St.Gallen and is currently based in Herrliberg, Zurich, Switzerland. Beyond finance, he is a former founder of LaSelva HotYoga in Vienna and serves as an advisor and early investor for European and US companies, including MyClubs and SIXAI. He also contributes as a columnist for Portafolio, Colombia's most prestigious financial newspaper.
Arauca Capital's objective is to find and invest in outstanding companies, with sustainable business models and growth attributes led by great management teams with the aim of compounding capital for long periods of time. The fund focuses on building a concentrated portfolio of high-quality, listed companies in OECD countries with sustainable business models and strong management. Their competitive advantage lies in identifying companies with unrecognized earnings potential and acquiring them at attractive valuations and risk profiles, minimizing the probability of permanent loss. The fund employs a barbelling strategy with a big portion of capital invested in very safe assets and a couple of risky investments with huge potential upside, expressing respect towards the unknown.
Lead Portfolio Manager
Moderate Conviction Bullish
Market Conviction
The score of 0.72 reflects Arauca's decisive, concentrated positioning in high-conviction ideas like VersaBank, Sofwave, and private power, alongside an uncompromising willingness to sell winners entirely when risk profiles shift. The manager avoids overly speculative diversification and sizes investments based on deep fundamental unit economics, though hedges such as index put options and large cash allocations moderate overall portfolio concentration.
Growth Outlook
Market outlook is slightly cautious at 0.45 due to extreme valuations across AI beneficiaries, decelerating free cash flow among tech giants, and severe macro fiscal imbalances. While acknowledging that headline earnings growth remains resilient, the manager warns that holding equities indefinitely without strict valuation underwriting is becoming dangerous.
Risk Appetite
Risk appetite is scored defensively at 0.35 because the fund has converted substantial equity profits into cash, short-dated US Treasuries, and gold, while also having purchased S&P 500 put options to hedge geopolitical conflict. The portfolio is deliberately structured as a barbell, retaining significant dry powder rather than deploying aggressively.
Capital Deployment
Capital deployment is scored at 0.20, reflecting moderate-to-heavy de-risking as the manager executed complete exits in Kioxia, Shelly Group, Vitalhub, AST SpaceMobile, and synthetic Alphabet options. These sales, along with record subscription inflows, left the fund holding an unusually large allocation in short-dated bonds and cash.
Forward Guidance
Forward guidance is scored at 0.45 as the manager emphasizes patience and selective monitoring rather than immediate deployment, waiting for clear 'no-brainer' opportunities to emerge. While actively studying South Korean equities and initiating a small private power campus position, the overarching posture remains patient capital preservation.
Language Signal
The language signal sits at 0.48, balancing discussions of 'extraordinary opportunities' and multi-bagger gains against heavy warnings regarding 'cyclicality,' 'violent volatility,' 'peak-cycle earnings,' and macro financial repression. Critical scrutiny of popular tech themes outweighs unhedged bullish expressions.
Perceived Risk
Perceived risk is elevated at 0.76 due to thorough analysis of systemic fiscal and monetary vulnerabilities, including US national debt surpassing $40 trillion, 5.2% long-term yields, Treasury buybacks resembling financial repression, and geopolitical escalation involving Iran.
Opportunity Density
Opportunity density is scored at 0.42 because the manager explicitly highlights that the easiest AI opportunities are gone and that free optionality has vanished across broader markets. Compelling risk/reward opportunities are described as increasingly scarce, prompting Arauca to look outside traditional markets toward South Korea and niche branchless banking.
Time Horizon
Time horizon is scored at 0.65 reflecting a multi-year underwriting framework (such as modeling VersaBank and Sofwave through 2028), counterbalanced by an agile willingness to harvest multi-year targets in months when share prices re-rate rapidly.
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