| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | -13.3% | 12.6% |
| 2025 |
|---|
| 12.6% |
Ghosh Capital delivered 36.8% returns since inception in June 2024 versus 29.1% for the S&P 500, but suffered a difficult Q4 2025 with -13.3% returns versus +2.6% for the index. The underperformance stemmed from concentration risk and options leverage mistakes. The portfolio's 30% position in Kneat, a SaaS company, experienced a 35% drawdown due to weak Q2/Q3 results where net new ARR came in below expectations from macro headwinds and deal delays. Additionally, the manager used long-dated options on Wix and Clearwater Analytics for leverage but sold both positions at losses due to volatility concerns, missing Clearwater's subsequent buyout. Key lessons include implementing strict position sizing limits regardless of conviction, avoiding quality compromises when hunting for cheap names, and using options sparingly. Despite setbacks, Kneat ended 2025 with record strategic customer wins, positioning for recovery in 2026-2027 as the company approaches $90M ARR with strong customer retention and expanding contracts.
Focus on high-conviction concentrated positions in undervalued technology companies while implementing strict risk management rules around position sizing and leverage to avoid the concentration and options-related losses experienced in Q4 2025.
Manager expects 2026 to see recovery in Kneat stock price as company marches towards $90M ARR. The highest number of new strategic customer wins in company history during 2025 should drive sustained higher growth in 2026 and 2027 as initial small contracts expand significantly over time.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jan 6 2026 | 2025 Q4 | AEM, APH, AVGO, CWAN, GOOGL, HOOD, MSFT, MU, NVDA, RHM.DE, SII, WIX | Concentration, Leverage, Options, risk management, SaaS, technology, value |
KSI CN WIX |
Manager learned hard lessons about position sizing and concentration risk after Kneat position at 30% of portfolio caused significant drawdown. Establishing strict rules around maximum… |
| Jul 2 2025 | 2025 Q2 | GOOG, KSI CN, MDA CN | Global Equities, Quality, stock picking, valuation gaps, volatility | MDA CN | The letter frames the market as a stock-pickers environment characterized by stretched valuations and sharp dispersion across geographies and sectors. Management emphasizes exploiting valuation gaps… |
| Apr 2 2025 | 2025 Q1 | COST, KPG AU, MDA CN | - | - | - |
| Jan 3 2025 | 2024 Q4 | ADBE, GOOG, MU, TEAM | - | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2025 Q4 |
OptionsUsed long-dated deep in-the-money options for leverage on Wix and Clearwater Analytics positions but found the inherent leverage made it difficult to hold positions through volatility. Planning to use options more sparingly going forward. |
Leverage Options Trading Deep ITM Volatility Position Management |
Risk ManagementPrimary goal is to avoid blowing up and survive through bad times. Uses rules like not buying whole positions at once, demanding 50% upside, watching leverage, and knowing when to double down. Maintains defensive portfolio positioning. |
Defensive Blow-up Discipline Concentration Cash | |
SaaSSoftware multiples have compressed as if AI disruption is inevitable, while hyperscalers and enterprises still struggle to demonstrate clear AI ROI. The traditional SaaS playbook faces challenges from AI eating into margins, attacking the pricing unit, and creating cannibalization problems. The software total addressable market is likely to grow 2-3x as AI replaces some work and the gap between software spend and headcount narrows. |
Software Disruption Margins Pricing Platform Shift | |
| 2025 Q2 |
ValuationAI-related companies continue to command premium valuations while other sectors remain reasonably priced. This valuation divide continues to guide investment activity, with the fund remaining wary of companies trading at exceedingly high valuations that imply exceptional multi-year earnings growth. |
Premium Divide Discipline Stretched Reasonable |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Jul 2, 2025 | Fund Letters | Shomik Ghosh | MDA CN | MDA Space Ltd. | Industrials | Aerospace & Defense | Bull | TSX | backlog, Constellations, Geointelligence, robotics, Satellites, Space, valuation | Login |
| Jan 6, 2026 | Fund Letters | Shomik Ghosh | KSI CN | kneat.com inc | Information Technology | Application Software | Bull | New York Stock Exchange | ARR, Retention, SaaS, Software, undervaluation | Login |
| Jan 6, 2026 | Fund Letters | Shomik Ghosh | WIX | Wix.com Ltd | Information Technology | Application Software | Bear | NASDAQ | AI, Margins, Options, Software, valuation | Login |
| TICKER | COMMENTARY |
|---|---|
| AEM | We initiated Agnico Eagle Mines to diversify our gold miner exposure alongside AngloGold Ashanti. Given the operational complexity of mining, spreading exposure across high-quality operators helps mitigate single-company risk. |
| APH | We trimmed Amphenol Corp. |
| AVGO | The primary contributors to its performance were our exposures to Broadcom |
| CWAN | With Clearwater, the market was overly focused on the debt and large acquisitions while missing how core Clearwater was growing strongly still and had a tailwind from rate cuts. Clearwater Analytics ended getting bought out and would've netted me a large gain but in the meantime due to the size of the position I took and the options leverage, the weak performance was causing me to question my conviction until I decided to sell my position for a 30% loss, 2 weeks before the buyout news came through. |
| GOOGL | In the third quarter, Google, Kairos Power, and the Tennessee Valley Authority announced a major collaboration centered on a novel power purchase agreement. Google followed this announcement with another significant step forward. On October 27, Google and NextEra Energy announced plans to restart the Duane Arnold Energy Center. |
| HOOD | Robinhood Markets, Inc. is a digital brokerage platform serving retail investors. Shares detracted during the quarter following robust performance over the first nine months of the year. While overall activity levels remain strong, Robinhood experienced some softening in customer engagement in November, with cryptocurrency trading volumes in particular declining on both a month-over-month and year-over-year basis. |
| MSFT | MSFT was a detractor in 4Q25 following its fiscal first-quarter 2026 earnings report released on October 29. While results were better than expected operationally, investor reaction was driven by guidance and capital expenditure intensity rather than headline performance. Revenue grew 17% year-over-year, exceeding consensus expectations, and Azure revenue increased 39% year-over-year, also ahead of estimates. However, management guided to a sequential deceleration in Azure growth in fiscal Q2, signaling some moderation after a period of exceptional demand. |
| MU | Core gains were led by investments in the Technology sector including Micron |
| 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. |
| RHM.DE | The top three contributors to this underperformance came from Rheinmetall (German Defense). The top three contributors to this outperformance came from Rheinmetall (German Defense) |
| SII | Sprott, and Agnico Eagle (the last two are precious metals positions that were small position sizes but delivered outsized returns given the performance of Gold and Silver in the quarter) |
| WIX | Wix.com Ltd. is a leading provider of cloud-based web-development platform for micro-businesses. Shares of Wix declined 41.5% during the fourth quarter and ended the year down 51.9% due to a quarterly earnings report that emphasized greater-than-expected investment behind their new acquisition, the vibe-coding startup, Base44. |
| Ticker | Put/Call | Amount Bought | Shares Bought | % Change | Weight % |
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