| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | - | - |
Charlie Morris views Q2 2026 markets as exhibiting clear bubble characteristics, with semiconductor valuations reaching extremes and margin debt at levels that historically preceded bear markets. The SOX index added $10 trillion in market cap, while market concentration mirrors 1999 levels. Despite the Whisky Portfolio lagging by 3.4% and Soda by 5% year-to-date due to avoiding the semiconductor rally, Morris maintains conviction in his value-first, capital-preservation approach. He reduced gold exposure after a strong run but remains long-term bullish based on central bank reserve dynamics. The Iran war surprisingly did not create an oil supply crisis, leading him to consider eliminating oil positions. Morris is building the Quality Portfolio to 94% invested, targeting large-cap companies with competitive advantages that have lagged since 2015. He sold Glencore, Hiscox, and Harbour Energy while adding Berkshire Hathaway, banks, and other value situations. The strategy emphasizes diversification across value, quality, and hard assets, positioning for outperformance when the current bubble inevitably bursts, just as equal-weight strategies outperformed after 1999.
The manager believes current markets exhibit bubble characteristics comparable to 1999, with extreme concentration in semiconductors and elevated margin debt signaling systemic risk. Rather than chase the tech rally, he advocates a capital-preservation-first approach focused on undervalued companies and quality stocks that have been ignored. By maintaining diversification across value, quality, gold, and other assets, the portfolio is positioned to outperform when the inevitable market correction occurs, just as equal-weight and value strategies did after previous bubbles.
The manager expects that sooner or later a bear market will follow the current rally, as long-term signs of excesses are clear. He maintains that investors should stick to basics by focusing on good and cheap companies that have been ignored during the tech rally. The manager is confident that when market froth cools, value investing will drive returns, and the cautious, diversified approach will ultimately win. He continues to prioritize capital preservation over investment gains.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jul 5 2026 | 2026 Q2 | BRK/B, GLEN.L, HBR.L, HSX.L | Bubble, capital preservation, diversification, gold, Multi-Asset, Quality, semiconductors, value | - | Morris sees 2026 markets in a bubble comparable to 1999, with semiconductor concentration and margin debt at dangerous extremes. His portfolios lag year-to-date by avoiding the chip rally, but he's doubling down on value and quality stocks ignored by the market. He's building a Quality portfolio of 24 large-cap compounders and maintaining diversification across gold and undervalued equities, positioned for outperformance when the bubble bursts. |
| Apr 8 2026 | 2026 Q1 | DEO, UL | commodities, Defensive, diversification, gold, Multi-Asset, oil, Quality, risk management |
DGE.L ULVR.L |
ByteTree shifts to defensive positioning following oil shock, reducing equity exposure and adding commodity diversifiers. Manager prioritizes capital preservation over gains amid geopolitical uncertainty, maintaining exposure to energy, quality stocks, and building recovery watchlist. Strategy awaits war resolution and economic recovery signals before redeploying capital into abundant opportunities expected to emerge. |
| Jan 7 2026 | 2025 Q4 | BARRY.SW, BHMG.L, BRWM.L, DEO, NESN.SW, PHP.L, RCP.L | commodities, diversification, Dollar, global, gold, Japan, Quality, value | - | Morris delivered 39% returns through global diversification and value investing while warning of US equity bubble at 39.8x CAPE ratio. Weak dollar drove international outperformance with Europe up 26% versus US 9.2%. Gold led all markets on geopolitical concerns. Strategy focuses on Japanese normalization, commodity cycle broadening, and quality companies while reducing precious metals exposure from peak levels. |
| Oct 5 2025 | 2025 Q3 | DEO, SMWH.L | Bitcoin, diversification, global, gold, Hard assets, Multi-Asset, Outperformance, Quality | - | ByteTree's multi-asset approach delivered 31.1% returns in 2025, significantly outperforming benchmarks through strategic positioning in hard assets like gold and Bitcoin, global diversification away from expensive US markets, and quality stock selection. Despite elevated market valuations, the manager maintains conviction in diversified portfolios emphasizing value, quality, and patience for long-term wealth creation. |
| Jul 6 2025 | 2025 Q2 | - | AI, diversification, growth, long-term, Optimism, Valuations | - | Financial Synergies makes a case for optimism in Q3 2025, highlighting declining rates, controlled inflation, and steady growth. While market valuations are elevated at 38x Shiller P/E, the firm emphasizes diversification across styles and sectors. AI represents significant opportunity despite concerns. Long-term patient investing continues to reward optimism and progress over time. |
| Apr 16 2025 | 2025 Q1 | - | Estate Planning, financial planning, Market Highs, Wealth management | - | Financial Synergies quarterly newsletter covers their internship program, estate planning guidance, and market commentary. Key insight: investing at market all-time highs has historically produced solid returns, with the S&P 500 delivering 9.4% average 1-year forward returns versus 9.1% for all periods. The firm emphasizes holistic wealth management addressing both technical and emotional client needs. |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2026 Q2 |
SemiconductorsThe manager views the semiconductor rally as a bubble comparable to 1999, with the SOX index adding $10 trillion in market cap to reach $16 trillion. He notes that semiconductors have been reclassified from value to growth stocks, repeating the pattern from 1999. The manager is deliberately avoiding semiconductor exposure in portfolios, viewing current valuations as extreme. |
AI Chips Valuation Bubble Taiwan |
ValueThe manager maintains a strong commitment to value investing despite recent underperformance, emphasizing that many good and cheap companies have been ignored during the tech rally. He uses the S&P 500 Equal Weight Index as evidence that diversified value strategies outperform over full cycles, particularly after bubble periods. The strategy focuses on capital preservation first. |
Equal Weight Diversification Capital Preservation Undervalued | |
QualityThe manager launched the ByteTree Quality Portfolio in September 2025 and has now built it to 94% invested with 24 stocks. He views quality stocks as significantly undervalued after lagging since 2015, drawing parallels to 1999. The portfolio focuses on great large companies with strong market positions, stability, and high returns for long-term buy-and-hold investing. |
Low Volatility Competitive Advantage Compounding Large Cap | |
GoldThe manager has reduced gold exposure since October 2025 following a strong run, but maintains a core position and long-term bullish view. He explains that central bank reserve growth and increased gold allocation drive long-term demand. Recent weakness is attributed to Middle East selling for cash needs during the Iran war, but the fundamental driver of reserve growth remains intact. |
Central Banks Reserves Safe Haven | |
OilDespite the War in Iran, oil markets have not experienced the expected supply crisis. The manager notes that global supply chains adapted remarkably quickly through diverted supply and inventory drawdowns. US inventories have declined to 1986 levels, but the rate of decline is slowing. He is considering reducing oil exposure to zero as the supply crisis risk appears to be diminishing. |
Iran Inventories Supply Geopolitics | |
Market ConcentrationThe manager highlights extreme concentration in market indices, with the S&P 500 top ten holdings representing 33.3% of the index. He compares current conditions to 1999, noting that concentration has reached bubble levels. The S&P 500 Equal Weight Index has lagged by around 30% during recent tech rallies, similar to the late 1990s pattern. |
Concentration Top Ten Bubble Diversification | |
Margin DebtThe manager identifies margin debt as at extreme levels comparable to previous market peaks in 1972, 1976, 1987, 2000, 2007, and 2021. He notes that investors have been leveraging up their trading accounts aggressively. These extremes in margin debt have historically preceded market downturns and bear markets. |
Leverage Speculation Risk Bubble | |
| 2026 Q1 |
OilOil shock changed market dynamics as missile strikes triggered surge in oil prices alongside bond yields. Manager expects commodity prices to be much higher over coming months and years due to ongoing conflicts affecting Straits of Hormuz and attacks on Russian oil exports. |
Energy Geopolitical Inflation Supply Chain |
GoldGold bore the brunt of the market selloff following the oil shock. Manager previously reduced precious metals exposure in late 2025 and continues to view gold as part of broader commodity diversification strategy for inflationary protection. |
Precious Metals Safe Haven Inflation Hedge | |
QualityManager shifted toward attractively priced, high-quality stocks that would prove resilient during slowdown and lower-interest-rate environment. Quality stocks have been stable as globally diversified businesses, though Diageo and Unilever have disappointed due to luxury goods exposure and deal-making concerns. |
Defensive Resilience Global Stability | |
AIAI impact on employment cannot be underestimated with job cuts driven by AI efficiencies creating pressure on jobs market. Data shows major global public companies employed 70 million people in 2019, now dropped to 65 million, while market values are 85% higher, demonstrating how rising stockmarkets don't create jobs like they used to. |
Employment Efficiency Technology Disruption | |
Private CreditSigns of stress in private credit markets, a shadow bank asset class that has ballooned in recent years. Some private credit funds have closed their doors, and the scale of the problem is unknown because these markets are private and lack disclosure. |
Credit Stress Shadow Banking Risk Disclosure | |
| 2025 Q4 |
GoldGold beat all major equity markets in 2025, driven primarily by geopolitical concerns and record purchases by the People's Bank of China seeking neutral reserve assets. The Whisky Portfolio held gold mining stocks and silver, with precious metals exposure reaching 38% in October before being reduced to 20.6%. |
Gold Miners Silver Central Banks Geopolitical |
ValueManager focuses on deep value investing, citing GMO's preference for value strategies and building diversified portfolios representing good value across countries, asset classes, and sectors. The approach consistently finds opportunities backed by fundamental value. |
Deep Value Fundamental Analysis Diversification | |
CommoditiesManager remains bullish on commodities broadly, noting they tend to move as a group and expects this cycle will prove similar. Focus is on broadening exposure to industrial metals and eventually other commodities including energy and agriculture. |
Industrial Metals Energy Agriculture Cycles | |
JapanJapan remains a high-conviction overweight position. The normalisation of the bond market with a cheap currency should lead to strong long-term performance. Japanese equities have been the worst place to invest since 1990, and this should change. |
Currency Bond Market Normalization | |
CryptoBitcoin fell 13.1% in 2025, with weakness coming late in Q4 alongside pullback in technology and high-volatility stocks. Despite being normally inversely sensitive to the dollar, Bitcoin declined even as the dollar weakened. Whisky made considerable gains in crypto-related equities. |
Bitcoin Volatility Technology | |
| 2025 Q3 |
GoldGold led the world in 2025 with a 19.3% rally in Q3, closely followed by Bitcoin. The manager views hard assets as more likely to slow than reverse, with the risk being balanced government budgets that would stop investors from trying to exit the system. |
Gold Hard Assets Inflation Store of Value Monetary Policy |
CryptoBitcoin closely followed gold's performance and is viewed as a hard asset alongside precious metals. The crypto ban in the UK is ending in October, which the manager sees as an exciting development. |
Bitcoin Crypto Digital Assets Hard Assets UK Regulation | |
SilverSilver delivered exceptional performance with a 32% rally in Q3, significantly outperforming most other asset classes and contributing meaningfully to portfolio returns. |
Silver Precious Metals Hard Assets Commodities Performance | |
QualityQuality investing is out of favor, having underperformed the US index by the largest amount in 12 years. The manager believes this presents an opportune time to build a portfolio of long-term winners and launched the ByteTree Quality Portfolio in August 2025. |
Quality Value Long-term Underperformance Opportunity | |
| 2025 Q2 |
AIAI represents incredible potential from curing diseases to improving productivity to reshaping how we live and work. The rapid rise of artificial intelligence is unsettling at times but offers endless opportunities. Current AI-related companies are well established with strong profitability and healthy balance sheets, unlike unprofitable dot-com companies of the past. |
Technology Innovation Productivity Growth Disruption |
ValuationsCurrent market valuations are high by historical standards with the Shiller P/E ratio at 38x versus the average of 27x. While stocks appear expensive, valuations don't reliably predict near-term returns and markets can continue rising if fundamentals remain strong. Opportunities exist across different styles and sizes with Large Value and Small Caps having more attractive valuations. |
Price-to-earnings Expensive Historical Fundamentals Opportunities |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Apr 8, 2026 | Fund Letters | ByteTree Asset Management | DGE.L | Diageo | Beverages - Wineries & Distilleries | Distillers & Vintners | Neutral | New York Stock Exchange | consumer spending, defensive, Luxury goods, premium spirits, premiumization, Quality Stock | Login |
| Apr 8, 2026 | Fund Letters | ByteTree Asset Management | ULVR.L | Unilever | Household & Personal Products | Personal Products | Bull | New York Stock Exchange | consumer goods, contrarian, Deal-making, Quality Stock, undervalued, Value Investment | Login |
| TICKER | COMMENTARY |
|---|---|
| BRK.B | In Q2, there were sales in Glencore, Hiscox, Harbour Energy, and blockchain equities. These had done well, especially Glencore. There were many more purchases, including Berkshire Hathaway, two banks, an airline, and other value situations. |
| GLEN.L | In Q2, there were sales in Glencore, Hiscox, Harbour Energy, and blockchain equities. These had done well, especially Glencore. |
| HSX.L | In Q2, there were sales in Glencore, Hiscox, Harbour Energy, and blockchain equities. |
| HBR.L | In Q2, there were sales in Glencore, Hiscox, Harbour Energy, and blockchain equities. |
| 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 | |||
