| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | -7.8% | -7.8% |
Stone Sentinel Capital lost 7.8% in Q1 2026 versus the S&P 500's 4.3% decline, with a concentrated 4-stock portfolio spanning Hong Kong, Malaysia, US, and Japan. Manager Marcel Gozali distinguishes between risk (bounded, probabilistic outcomes) and uncertainty (unbounded, unpredictable outcomes), deliberately focusing on the former. The portfolio's two main detractors were Ascentech, a Japanese VDI infrastructure provider down 30% on AI disruption fears, and Protasco, a Malaysian road maintenance company down 21% on contract renewal uncertainty. Gozali argues AI fears are misplaced for infrastructure-layer businesses like Ascentech, which should benefit from increased IT complexity. Protasco trades at 1.3x earnings with 2.5x market cap in net cash, with strong historical precedent for contract renewals. Using the Proteus metaphor from The Odyssey, the manager emphasizes holding through market transformations to capture eventual rewards, positioning the portfolio to benefit from resolution of current geopolitical and technological uncertainties while maintaining strong downside protection.
Focus on businesses with risky but bounded outcomes rather than uncertain unbounded ones, maintaining concentrated positions in infrastructure-layer companies with defensive characteristics and significant upside potential when current market uncertainties resolve.
Manager expects current macro uncertainties to resolve favorably for positioned holdings, emphasizing the importance of holding through volatility to capture eventual rewards when uncertainties clear.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Apr 8 2026 | 2026 Q1 | - | AI, Asia, infrastructure, risk management, uncertainty, value |
ASCENTECH.T PROTASCO.KL |
Stone Sentinel's concentrated 4-stock Asian portfolio declined 7.8% on AI disruption fears and contract uncertainty. Manager distinguishes between manageable risk and unpredictable uncertainty, focusing only on businesses with bounded outcomes. Current holdings in Japanese VDI infrastructure and Malaysian road maintenance offer strong downside protection with significant upside when market uncertainties resolve. |
| Jan 2 2026 | 2025 Q4 | ASCENTECH.T | AI, Asia, Cloud, Japan, Mental Models, Philosophy, value | 3565 JP | Stone Sentinel delivered 50.7% in 2025 through patient, opportunistic investing. Manager positions as wild lion versus zoo lion, emphasizing judgment over predictability. Portfolio spans Asia with new Japanese holding Ascentech, a Citrix VDI operator benefiting from hybrid work trends. Dismisses AI disruption concerns, arguing sustainable insights require mental models beyond accessible knowledge. |
| Oct 9 2025 | 2025 Q3 | 1627.HK, 5238.KL | Asia, Capital Allocation, Construction, dividends, real estate, value | - | Stone Sentinel Capital generated 45.3% YTD returns through concentrated value investing in 5 Asian and European positions. The fund emphasizes certainty-driven stock selection, recently adding Hong Kong construction company Able Engineering (9% dividend yield, office building overhang) and Malaysian road maintenance operator Protasco (asset monetization catalyst). Philosophy centers on practical wisdom and rapid adaptation to changing realities. |
| Jul 7 2025 | 2025 Q2 | CLA.PA, FINV, GSJ.MC | Buffett, cash flow, China, Construction, Europe, Fintech, technology, value | - | Stone Sentinel Capital achieved 38% YTD returns through concentrated value investing in deeply discounted securities. The portfolio focuses on three core holdings: Spanish construction company GSJ trading at minimal valuation despite strong cash flows, software publisher CLA at 6.5x FCF, and Chinese fintech FINV offering 30% FCF yields in a consolidated oligopoly market. |
| Apr 9 2025 | 2025 Q1 | - | dividends, Equity Valuations, Fed policy, fixed income, interest rates, Market Outlook | - | Oujo Wealth Strategies reports strong 2025 performance across asset classes with the S&P 500 recovering to 6,700. The firm is cautiously optimistic, making tactical moves into fixed income as markets climbed. They favor dividend payers, mid and small caps, and bonds, believing current equity valuations offer only slight premiums over safer assets. |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2026 Q1 |
AIManager discusses AI disruption fears affecting portfolio company Ascentech, arguing that AI actually increases demand for infrastructure-layer services like VDI and security. The narrative of AI displacing software incumbents is viewed as misapplied to infrastructure providers. |
Infrastructure VDI Security Disruption |
InfrastructurePortfolio includes infrastructure plays in both technology (Ascentech's VDI infrastructure) and physical infrastructure (Protasco's road maintenance contracts in Malaysia). Manager emphasizes the defensive nature and switching costs of infrastructure businesses. |
Roads Maintenance Switching Costs Contracts | |
| 2025 Q4 |
AIManager views AI as unlikely to disrupt Citrix's VDI business, positioning it as infrastructure that AI runs within rather than being displaced by it. Discusses how LLMs synthesize existing knowledge but don't flatten the mountain to insight, maintaining that value investing edges persist despite AI advances. |
Artificial Intelligence LLMs Value Investing Software Infrastructure |
CloudFocuses on Virtual Desktop Infrastructure through Ascentech's transformation to become Citrix operator in Japan. Emphasizes post-pandemic hybrid work tailwinds and demand from risk-averse customers in regulated industries for secure hybrid work solutions. |
VDI Virtual Desktop Hybrid Work Citrix Infrastructure | |
| 2025 Q3 |
ConstructionAble Engineering Holdings is engaged in building construction and RMAA projects for Hong Kong public works, with double-digit growth and strong fundamentals supported by government spending on public housing projects. |
Public Works RMAA Government Contracts Infrastructure |
Commercial Real EstateAble Engineering faces potential impairments on an office building carried at book value equal to market cap, with Hong Kong office vacancy at 17% and Kowloon East at 24%, though cities are resilient and don't die like companies. |
Office Buildings Vacancy Rates Impairments Hong Kong | |
DividendsAble Engineering offers roughly 9% dividend yield with consistent and growing dividends since 2022. Protasco used to pay dividends until 2019 and resumption would signal proper capital allocation. |
Dividend Yield Dividend Growth Capital Allocation | |
| 2025 Q2 |
ValueThe manager emphasizes deep value investing principles throughout the letter, highlighting stocks trading at significant discounts to intrinsic value. Portfolio holdings like GSJ trading at 6.5x FCF and FINV offering 30% FCF yields demonstrate the focus on undervalued securities with strong fundamentals. |
Intrinsic Value FCF Discount Bargain Undervalued |
FinTechFINV represents a significant position as a Chinese nonbank lender connecting borrowers to lenders for fees. The company operates in an oligopoly after 95% of competitors exited due to regulations, with superior technology and risk models updating weekly versus quarterly for competitors. |
Lending China Technology Risk Models Oligopoly | |
ConstructionGSJ operates a core construction business valued at only €50m despite generating €32m net earnings and €117m free cash flow last year. The manager views this as an incredible bargain even excluding the value of undeveloped land holdings. |
Infrastructure Cash Flow Earnings Land Valuation | |
| 2025 Q1 |
DividendsDividend payers have performed well and paid their dividends. The firm views dividend-paying stocks as attractive investments with fair valuations and strong holdings for retiree income. |
Income Yields Retirees Valuations Performance |
RatesThe Federal Reserve has made only one minor cut this year despite pressure from the Trump administration. The firm expects more rate cuts would require negative employment data, weaker consumer sentiment, low inflation, and manufacturing softness. |
Fed Cuts Employment Inflation Manufacturing |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Apr 8, 2026 | Fund Letters | Stone Sentinel Capital | ASCENTECH.T | Ascentech | Other | Systems Software | Bull | New York Stock Exchange | AI disruption, cash-rich, Citrix, Defensive Technology, infrastructure software, insider ownership, Japan, Value, Vdi, Zero Trust Security | Login |
| Apr 8, 2026 | Fund Letters | Stone Sentinel Capital | PROTASCO.KL | Protasco | Other | Construction & Engineering | Bull | Bolsas y Mercados Españoles (Madrid) | asset value, contract renewal, government contracts, infrastructure, Malaysia, net cash, political risk, Road Maintenance, switching costs, Value | Login |
| Jan 2, 2026 | Fund Letters | Marcel Gozali | 3565 JP | Ascentech K.K. | Information Technology | IT Services & Systems Integration | Bull | New York Stock Exchange | Execution, Hybridwork, Margins, Subscriptions, Vdi | Login |
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