| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | - | - |
Kinsman Oak's Q3 2025 commentary draws stark parallels between today's market and the dot-com bubble, highlighting extreme concentration where only AI and debasement trades have worked. The manager argues that Big Tech's $400 billion AI infrastructure spending in 2025 represents massive capital misallocation, requiring a 100-fold revenue increase to justify costs. With companies transitioning from capital-light to capital-intensive models and using off-balance-sheet SPV structures to hide leverage, the setup mirrors classic bubble characteristics. Valuations are stretched on virtually every metric, with the Shiller PE at 39.6x and the S&P 500 expensive on 20 of 20 metrics tracked by Bank of America. The Russell 2000 shows speculative frenzy with pre-revenue companies at multi-billion valuations. While anticipating continued near-term strength due to committed 2026 spending, the manager expects heightened volatility looking toward 2027. The debasement trade in gold reflects growing concerns about monetary stability and fiscal dominance, with gold up 32% in two months.
The current market environment mirrors the dot-com bubble with extreme concentration in AI-related stocks, massive capital misallocation, and unsustainable valuations that will eventually lead to a significant correction when investors realize the economics don't work.
The manager anticipates continued strength in equity markets as capital has already been committed for AI buildout projects in 2026, but expects heightened volatility once the market begins looking toward 2027 and beyond. The base case is that current valuations suggest a meaningful step-up in infrastructure spending and there could be sudden turbulence if funding slows. Gold is viewed as tactically overbought but structurally under-owned.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Oct 31 2025 | 2025 Q3 | ACHR, ASTS, CRML, DGNX, FRMI, GLD, JOBY, LAC, MEME, NNE, NXE, OKLO, PPTA, QMMM, QS, QUBT, RGCI, RGTI, SERV, SKE, TMC | AI, Bubble, debasement, gold, infrastructure, Speculation, technology, valuation | - | Kinsman Oak sees today's AI-driven market as a dot-com style bubble with extreme concentration and massive capital misallocation. Big Tech's $400 billion AI spending requires impossible revenue growth to justify costs. Valuations are stretched on every metric while speculative frenzy grips small caps. The debasement trade in gold reflects monetary concerns as fiscal deficits soar. |
| Jul 30 2025 | 2025 Q2 | COIN, CRCL, HOOD, MSTR, PLTR | AI, crypto, Debt, policy, rates, Speculation, tariffs, technology | - | Markets exhibit speculative excess with euphoric sentiment despite fiscal dominance and unfixable debt crisis. Cryptocurrency may decouple as fiscal hedge while AI disrupts industries. Federal Reserve faces political pressure for rate cuts despite strong conditions. Manager seeks company-specific inflection points while avoiding disruption losers. Fiscal spending may support near-term but stretched valuations suggest potential correction. |
| Apr 29 2025 | 2025 Q1 | DG, RACE | inflation, Markets, policy, Recession, tariffs, Trade Policy, uncertainty, volatility | - | Kinsman Oak navigates extreme tariff-induced volatility following Liberation Day, with markets experiencing GFC-level stress and 22% S&P decline. Manager maintains exposure despite recession risks, viewing policy uncertainty as self-inflicted and reversible. Focus on quality long-term opportunities while prioritizing flexibility amid unprecedented government policy swings and 90-day tariff delay creating prolonged uncertainty. |
| Feb 28 2025 | 2024 Q4 | AAPL, BTC-USD, COST, NVDA, WMT | AI, Concentration, growth, inflation, Passive, SMID Cap, Speculation, value | - | Extreme market concentration driven by passive investing has created structural distortions favoring MAG7 while value stocks trade at cheapest levels since Dot-Com bubble. Manager sees opportunity in neglected SMID-caps as current conditions mirror early 2000s value hunting grounds, positioning for potential leadership regime change over next decade. |
| Oct 28 2024 | 2024 Q3 | AMZN, DG, DLTR, GOOG, MSFT, RACE, RMS.PA, TGT, WMT | Bifurcated Economy, Dollar Stores, Hidden Segments, Luxury, nuclear, uranium, value | - | Kinsman Oak sees a bifurcated economy favoring security selection over broad exposure. Initiated unnamed position in hidden segment story while building uranium exposure on nuclear renaissance from tech giants. Concerns about system fragility and expensive valuations drive focus on off-the-beaten-path value opportunities and gold ownership amid rising fiscal deficits. |
| Jul 25 2024 | 2024 Q2 | AMC, CHWY, CIGI, GME, NKE, NVDA, SPW, SPY | AI, interest rates, momentum, Rotation, small caps, technology, valuation | - | Agostino sees historic opportunity in SMID-caps after extreme underperformance versus AI-driven mega-caps. July's inflation-triggered rotation validates his thesis that small caps will benefit disproportionately from rate cuts given higher debt burdens and cheaper valuations. Fund is 70% net long, redeploying capital into SMID-cap opportunities over 3-5 year horizon despite recession and AI disruption risks. |
| May 10 2024 | 2024 Q1 | CHDN, GLD, GOOG, NKE, TDW | AI, gold, inflation, rates, Speculation, technology | GOOG | Kinsman Oak navigates euphoric speculation and persistent inflation by maintaining selective longs like Alphabet while hedging fiscal risks through gold. With rate cuts evaporating and technology outperformance reaching dot-com extremes, the manager expects fat-tailed volatility as markets reconcile with higher-for-longer reality. |
| Feb 26 2024 | 2023 Q4 | AAPL, AMZN, CIGI, CSCO, GOOGL, META, MSFT, NVDA, TSLA | AI, Concentration, energy, real estate, Sentiment, technology, Valuations | CIGI | Kinsman Oak warns of dangerous market concentration in Magnificent 7 stocks reminiscent of dot-com bubble conditions, with 72% of S&P constituents underperforming. Despite macro headwinds including sticky inflation and stretched valuations, the manager sees bottom-up opportunities in the valuation gap between mega-caps and broader market, recently adding energy exposure focused on buybacks over commodity bets. |
| Oct 30 2023 | 2023 Q3 | - | Bear Market, Buybacks, credit, rates, Recession, Valuations | - | Kinsman Oak sees a two-punch bear market with valuation compression mostly done but earnings revisions ahead as higher rates work through the economy. They expect volatile, rangebound markets favoring stock-pickers over the next three-to-five years, focusing on share buyback cannibals and quality businesses while avoiding overleveraged companies facing tightening credit conditions. |
| Jul 18 2023 | 2023 Q2 | AMZN, AZO, BIG, CSCO, MSFT, NVDA, W | AI, Buybacks, Recession, retail, SMID Cap, technology, Valuations, yield curve | - | Kinsman Oak warns of AI bubble dynamics driving narrow market rally, with severely inverted yield curve signaling 2024 recession risk. Manager avoids expensive mega-cap technology stocks, instead finding SMID-cap opportunities while preparing defensive positioning. Emphasizes quality capital allocation and expects prolonged sideways market with eventual leadership rotation from current AI beneficiaries. |
| Apr 28 2023 | 2023 Q1 | ATVI, CIGI, LULU, MSFT, TKWY.AS, TSLA | Banking, credit, Fed policy, real estate, Regional Banks, risk management | CIGI | Kinsman Oak views SVB's collapse as proof the Fed's rate hiking cycle broke banking, leading to inevitable credit tightening and recession risk. They're closing merger arbitrage positions like Activision while maintaining core holdings like Colliers despite real estate headwinds. The manager expects continued volatility but sees opportunity for patient investors to buy quality at discounts. |
| Jan 3 2023 | 2022 Q4 | - | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2025 Q3 |
AIThe manager sees AI as a speculative bubble similar to the dot-com era, with massive capital misallocation and unsustainable valuations. Big Tech firms are spending $400 billion in 2025 on AI infrastructure buildout, requiring a 100-fold revenue increase to justify costs. The manager believes this capex binge will eventually end badly when investors realize AI isn't generating incremental free cash flow. |
Bubble Capex Buildout Valuation Infrastructure |
GoldGold represents the debasement trade as investors express concerns about monetary stability. Gold increased 32% between August and October 2025 without meaningful pullbacks. The manager notes that since 2004, the S&P 500 has delivered virtually zero value creation when denominated in gold, suggesting credit creation and currency debasement drove stock prices. |
Debasement Monetary Inflation Currency Fiscal | |
SemiconductorsThe semiconductor sector is central to the AI buildout with companies like NVIDIA experiencing massive valuations. The manager draws parallels to Cisco during the dot-com bubble, noting similar bull thesis arguments about revolutionary technology and unlimited potential. Semiconductor companies are transitioning from capital-light to capital-intensive business models. |
NVIDIA Cisco Capital Technology Valuation | |
Data CentersData center buildout is the physical manifestation of AI investment with companies spending unprecedented amounts on infrastructure. The manager calculates that with 5-year useful lifespans before obsolescence, depreciation alone will be $90 billion annually. Even with generous assumptions about margins, the economics appear unsustainable. |
Infrastructure Depreciation Economics Obsolescence Buildout | |
Private CreditPrivate credit is being used to finance AI infrastructure through off-balance-sheet structures. META secured $30 billion through an SPV tied to Blue Owl Capital for datacenter construction. Morgan Stanley estimates tech firms will need $800 billion from private credit by 2028, creating opacity and amplifying tail risks. |
SPV Leverage Opacity Risk Financing | |
| 2025 Q2 |
CryptoBitcoin reached all-time high of $120k, up 60% since April low. Manager explores potential decoupling from traditional risk assets as hedge against national debt crisis. Cryptocurrency experiencing speculative fervor with Bitcoin-linked firms rallying 78% in Q2. |
Bitcoin Cryptocurrency Decoupling Speculation Hedge |
AIMega-cap technology stocks driven by continued AI enthusiasm led market rally. AI will render certain businesses obsolete unless they adapt. Image generation tools disrupting photography, legal document drafting replacing human lawyers, and AI companions threatening online dating platforms. |
Technology Disruption Automation Innovation Obsolescence | |
Trade PolicyTariffs take center stage with estimated effective rate of 16% if further sector-specific tariffs emerge. Companies reassessing sustained tariff exposure with fundamental headwinds persisting for small-to-medium businesses amid policy uncertainty. |
Tariffs Trade Policy Uncertainty Business | |
RatesFederal Reserve under political pressure to cut rates despite strong financial conditions. Rate cuts could cause back-end yields to rip higher, creating yield curve steepening with profound implications for markets and economy. |
Interest Federal Monetary Curve Policy | |
Risk AppetiteInsatiable risk appetite permeates every corner of market with rapid resurgence in speculative behavior. Levkovich Index back to euphoric territory, S&P 500 trading in highest valuation decile, suggesting reckless investor sentiment. |
Speculation Euphoria Sentiment Valuation Bubble | |
| 2025 Q1 |
Trade PolicyThe letter extensively discusses the implementation of reciprocal tariffs following Liberation Day, describing them as the largest tariff increase in almost one hundred years. The manager analyzes the confusion around policy objectives, noting contradictory messaging about whether tariffs are negotiating tools or permanent revenue sources. The discussion covers knock-on consequences including supply chain disruption, margin compression, and economic uncertainty. |
Tariffs Trade War Supply Chain Inflation Policy |
VolatilityMarkets experienced extreme volatility with the VIX increasing 179% in three trading days following Liberation Day. The S&P 500 collapsed 22% from peak-to-trough before recovering more than half the move. The manager describes GFC levels of volatility and panic selling as investors struggled to digest the tariff announcements. |
VIX Market Stress Correlation Panic Uncertainty | |
InflationThe manager discusses tariff-induced inflation as a key concern, describing tariffs as a regressive consumption tax. There are concerns about sticky inflation combined with slower GDP growth creating a disastrous scenario for equity valuations. The discussion includes potential supply shocks and reduced production causing inflation due to shortages. |
Price Increases Consumer Impact Fed Policy Stagflation Cost Push | |
Risk AppetiteThe letter describes a significant reduction in risk appetite following the tariff announcements, with investors experiencing decision paralysis and confusion. Management teams have rescinded forward guidance, and there's discussion of reduced confidence among business leaders and investors due to policy uncertainty. |
Uncertainty Confidence Positioning Sentiment Guidance | |
| 2024 Q4 |
Market ConcentrationThe S&P 500 top ten stocks combine for a record-setting 37% of total market capitalization, exceeding the Dot-Com bubble by 14%. MAG7 stocks gained 60.5% versus 13.0% for equal weight index. This concentration creates structural risks as passive fund flows exacerbate momentum effects. |
Concentration MAG7 Passive Structural Bubble |
Passive InvestingPassive investing now represents 54% of the market with 68% being cap-weighted vehicles. This inflates valuations, distorts price-value relationships, exacerbates momentum effects, and systematically disadvantages value-oriented active managers through structural fund flows. |
Passive Cap-weighted Momentum Structural Flows | |
ValueValue stocks are at their cheapest relative to growth since the Dot-Com bubble burst. The S&P 500 Growth Index outperformed Value by 24% in 2024. This creates productive hunting grounds for value-conscious bottom-up stock pickers similar to the early 2000s opportunity set. |
Value Growth Relative Opportunity Dispersion | |
AIThe manager remains skeptical of winner-take-all AI mentality, citing political activism undermining trust, historical disruption patterns, and vanishing barriers to entry. DeepSeek's challenge to NVIDIA demonstrated that AI dominance may be transitory first-mover advantage rather than permanent moat. |
AI Disruption Moat Competition Technology | |
Risk AppetiteEuphoric equity sentiment extends beyond quality businesses to speculative assets. Meme coins like Fartcoin reached $2.4 billion market cap, 0DTE options volume exploded, and betting on everything from tweets to government buyouts demonstrates skyrocketing risk appetite across all asset classes. |
Speculation Meme Options Euphoria Gambling | |
InflationDisinflation momentum appears stalled around 3% with the last 1% proving most challenging. Cumulative pandemic inflation still impacts median consumers. There is real risk inflation reaccelerates, making future rate cuts reactive rather than proactive in nature. |
Inflation Disinflation Consumer Fed Rates | |
| 2024 Q3 |
NuclearMega-cap technology companies are turning to nuclear power to meet electricity demand for AI and data centers. Alphabet, Amazon, and Microsoft have all signed agreements for small modular reactors, indicating a dramatic shift in sentiment towards nuclear energy. |
Nuclear Data Centers AI SMR Electricity |
UraniumRising demand for uranium is expected over the next decade while supply remains constrained. Current spot prices are insufficient to incentivize new exploration and production, creating a classic supply-demand imbalance with asymmetric upside potential. |
Uranium Supply Demand Commodity Nuclear | |
Dollar StoresDollar General and Dollar Tree are experiencing significant pressure as their low-income customer base faces financial strain. Customers are resorting to credit cards for basic needs with 30% having maxed-out cards and 25% expecting to miss bill payments. |
Dollar Stores Trade Down Consumer Credit Low Income | |
LuxuryUltra high-end luxury brands like Ferrari and Hermes are thriving with strong order books and robust growth. Ferrari's order book extends into 2026 while Hermes shows continued strength in the US market with 13% growth. |
Luxury Ferrari Hermes Affluent Growth | |
| 2024 Q2 |
AIThe AI trade dominated the first half of 2024, with NVIDIA contributing disproportionately to index gains. The manager questions whether AI will truly benefit large incumbents or if small disruptors will eventually upend established business models, as has historically occurred with revolutionary technological innovations. |
NVIDIA Technology Disruption Innovation Semiconductors |
Small CapsThe manager sees tremendous opportunity in SMID-caps over the next 3-5 years due to significant underperformance, expected benefits from declining interest rates and moderating inflation, cheaper valuations versus large caps, and sentiment that appears to have troughed before the July rotation. |
Russell 2000 Valuation Interest Rates Rotation Opportunity | |
MomentumMomentum was the single best performing factor in the first half as investors chased technology stocks. The extreme bifurcation between large cap growth and small cap value reached historic levels, with only 25% of S&P 500 stocks making new highs despite the index reaching fresh records. |
Factor Technology Bifurcation Performance Dispersion | |
| 2024 Q1 |
AIAlphabet's Gemini AI tool controversy highlighted serious cultural and bias issues that pose risks to the company's search moat. The manager believes AI competitive advantages will depend on perceived bias rather than processing power, with users gravitating toward trusted, unbiased outputs. |
Artificial Intelligence Search Bias Trust |
GoldGold reached record highs despite rising real interest rates, breaking historical correlations. The manager attributes this to unsustainable fiscal deficits and believes the inversion signals expectations of future monetary accommodation or debt monetization. |
Monetary Policy Fiscal Deficit Real Rates Hedge | |
InflationInflation has remained above 3% for 36 consecutive months with recent acceleration. The manager expects higher-for-longer interest rates as the consensus shifts from immaculate disinflation to persistent inflation with strong nominal growth. |
CPI Rate Cuts Economic Growth Volatility | |
| 2023 Q4 |
AIThe fascination with artificial intelligence has been around for generations and is obviously growing rapidly, likely to enhance productivity and change industry dynamics. However, at some point the hype gets overblown and anticipated growth rates become unrealistic, leading to ugly expectations resets. The AI narrative is compared to the internet hype during the dot-com bubble. |
Artificial Intelligence Technology Productivity Hype |
Commercial Real EstateThe sector faces significant headwinds including elevated office vacancies, work-from-home trends reducing office footprints, rising property management expenses with declining rents, and refinancing challenges due to higher interest rates. Many property owners will find themselves underwater when refinancing, with some declaring bankruptcy. |
Office Refinancing Interest Rates Vacancies Work From Home | |
BuybacksThe manager continues to favor cash flow machines that use proceeds to repurchase shares in the open market. They recently initiated a position in an energy company expected to generate meaningful free cash flow and buy back a meaningful percentage of shares outstanding, with the thesis focused on capital allocation rather than oil prices. |
Share Repurchases Capital Allocation Free Cash Flow Energy | |
| 2023 Q3 |
RatesThe fund believes we have entered a new interest rate era where the cost of capital remains non-zero, potentially at a multi-decade turning point. Rising long-term rates are problematic for the real economy with negative impacts occurring with a lag. |
Interest Rates Yield Curve Cost of Capital Monetary Policy Bond Yields |
BuybacksThe fund is focusing on cannibals - companies that consistently shrink their share count over long stretches. They prefer situations where repurchases are funded with cash rather than leverage and see compelling opportunities in both consistent and opportunistic repurchasers. |
Share Repurchases Capital Allocation Share Count Reduction Cash Returns | |
Credit StressThe fund expects overleveraged businesses to become increasingly vulnerable as management teams find it more difficult to secure financing and settle for disadvantageous terms when rolling existing debt. Lenders will require higher coupons and stricter covenants. |
Credit Conditions Debt Refinancing Leverage Financing Costs | |
| 2023 Q2 |
AIManager views AI hype as reminiscent of dot-com bubble, with valuations driven by multiple expansion rather than fundamentals. Notes Nvidia trades at 43x revenues and 221x trailing EPS with no margin of safety. Believes most AI beneficiaries won't grow into current valuations, though some exceptions may take years or decades. |
Artificial Intelligence Valuations Bubble Technology Nvidia |
BuybacksDiscusses both successful buyback programs like AutoZone and disastrous ones like Big Lots, which spent $600 million at $52/share while stock now trades at $8. Emphasizes importance of management quality in capital allocation decisions and avoiding companies with poor buyback track records. |
Share Repurchases Capital Allocation Management AutoZone Big Lots | |
E-commerceExpects e-commerce and traditional retail to grow at similar rates going forward as pandemic effects normalize. Notes Amazon and Wayfair are cutting costs to right-size operations. Believes omnichannel presence will be minimum requirement for competitive advantage. |
Online Retail Amazon Wayfair Omnichannel Retail | |
| 2023 Q1 |
Regional BanksSilicon Valley Bank's collapse exemplified gradual then sudden failure, with poor risk management and duration mismatch between assets and liabilities. Banking stress will lead to credit tightening and reduced lending, creating disinflationary pressures. The manager expects continued stress in regional banking despite immediate containment efforts. |
Banking Credit Risk Management Duration Risk Deposits |
Commercial Real EstateEnormous stress in the sector due to regional banking problems and a wall of debt coming due in 2024 requiring refinancing. Despite holding Colliers International, the manager acknowledges investor concerns about anything commercial real estate related given the banking sector stress. |
Real Estate Refinancing Banking Debt | |
RatesThe Fed's fastest rate hiking cycle in history broke regional banks, suggesting further rate hikes will be minimal. The manager believes the Fed will choose financial stability over its dual mandate when forced to choose, with any pause delivered with cautionary language. |
Federal Reserve Interest Rates Monetary Policy Financial Stability |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Apr 25, 2024 | Fund Letters | Kinsman Oak | GOOG | Alphabet Inc. | Communication Services | Interactive Media & Services | Neutral | NASDAQ | Artificial Intelligence, Content moderation, Corporate culture, economic moat, Reputational Risk, search engine, technology | Login |
| Feb 26, 2024 | Fund Letters | Kinsman Oak | CIGI | Colliers International Group | Real Estate | Real Estate Services | Bull | NASDAQ | commercial real estate, contrarian, professional services, Real Estate Services, recurring revenue, turnaround | Login |
| Apr 28, 2023 | Fund Letters | Kinsman Oak | CIGI | Colliers International Group | Real Estate | Real Estate Services | Bull | NASDAQ | Banking Crisis, commercial real estate, debt refinancing, investment management, professional services, Real Estate Services | Login |
| TICKER | COMMENTARY |
|---|---|
| GLD | Since its inception in November 2004, the SPDR Gold Shares ETF (GLD) has generated an annualized total return of +10.6%, performing virtually in line with the S&P 500 which delivered an annualized total return of +10.9%. |
| MEME | The Roundhill Meme Stock ETF (MEME) originally launched on December 8, 2021, which almost perfectly coincided with the peak in the Nasdaq before it declined -38% over the next twelve months. The ETF shuttered in November 2023 and since then the Nasdaq is +76%. The Roundhill Meme Stock ETF (MEME) has been resurrected from the dead and began trading once again on October 8, 2025. |
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