| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | - | - |
Troy Global Equity Strategy underperformed in 2025 as global equity markets advanced, despite portfolio companies maintaining excellent operating momentum. The Strategy's poor performance stemmed from three factors: animal spirits favoring cyclical and speculative companies, AI disruption concerns affecting data and software holdings, and specific mistakes with Fiserv and Diageo. The prominence of AI hurt performance by benefiting semiconductor companies not owned and questioning the durability of several portfolio companies. However, AI disruption is more imagined than real, with earnings remaining sound for companies in the crosshairs. Major technology holdings like Alphabet, Microsoft, and Meta continue to see accelerating revenue growth driven by AI demand that outstrips supply. Data companies like Experian and LSEG face hypothetical competitive threats but possess proprietary datasets and regulatory moats that provide protection. The Strategy now trades at a historic discount on free cash flow yield despite superior financial metrics, positioning it well for future returns as valuations of other market areas look stretched.
The Strategy's companies maintained excellent operating momentum in 2025 despite poor share price performance, creating a significant opportunity as the portfolio trades at a historic discount to the market on free cash flow yield despite superior financial productivity, reinvestment and growth.
The Strategy is particularly well placed with reasonably valued, lowly levered, and economically resilient companies. In a dynamic environment defined by technological change, the differentiated focus on adaptive reinvestment to sustain long-term growth is a powerful and durable foundation. Actions will continue to be guided by a disciplined focus and objective of achieving double-digit returns that compound over the long term.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jan 18 2026 | 2025 Q4 | AMZN, DEO, EXPN.L, FI, GOOGL, LSEG.L, META, MSFT, NVDA | AI, Cloud, Data, global, Quality, technology, value |
FISV DGE LN LSEG LN EXPN LN |
AI disruption is more imagined than real at this point, with earnings for companies in the crosshairs remaining sound. The Strategy sees significant opportunity as several portfolio companies are temporarily misjudged in debates about AI's potential impact. Capital expenditure estimates for major tech companies are over 50% above where they were 18 months ago, but scaling laws continue to hold and AI demand currently outstrips supply. Data and information service providers face hypothetical challenges focused on AI's potential to change competitive dynamics, leading to valuation de-rating despite solid operating results. Companies like Experian and LSEG have proprietary datasets that cannot be easily replicated by AI, with deep regulatory moats and embedded customer relationships providing protection. Cloud service revenues are accelerating as capacity comes online, with contracted backlogs growing substantially faster than revenues. Despite enormous scale, revenue growth has accelerated across major cloud providers including Azure, Google Cloud, and AWS, driven by AI demand that currently outstrips supply. |
| Oct 30 2025 | 2025 Q3 | GOOG, MSFT | AI, gold, inflation, Speculation, valuation | - | AI: The letter warns of speculative excess reminiscent of the dot-com era. AI spending is massive, vendor-financed, and may not justify current equity valuations. Valuation: Market-wide multiples, especially the CAPE ratio near 40x, signal stretched valuations. Defensive sectors remain undervalued despite resilient fundamentals. Gold: Gold remains a long-term store of value and portfolio hedge, supported by central-bank accumulation, fiscal deterioration, and geopolitical risk. Trimmed modestly after a sharp rise, but remains a core holding. |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2025 Q4 |
AIAI has been integrated into RGA's research process through tools like NotebookLM, Gems in Gemini, and Claude Code. The firm views AI as a force multiplier for human judgment rather than a replacement, emphasizing the Kasparov Law principle. They believe the market narrative around AI displacement is swinging to unhelpful extremes, creating investment opportunities. |
Machine Learning Automation Software Productivity Innovation |
CloudAmazon's positioning to benefit from both infrastructure and application layers of AI is highlighted. The company's logistical prowess represents one of the foremost moats in business and will be enhanced with AI through better orchestration of logistics assets and buildout of more sophisticated robotics. |
Infrastructure Logistics Automation Efficiency Coordination | |
DataData and information service providers face hypothetical challenges focused on AI's potential to change competitive dynamics, leading to valuation de-rating despite solid operating results. Companies like Experian and LSEG have proprietary datasets that cannot be easily replicated by AI, with deep regulatory moats and embedded customer relationships providing protection. |
Data Analytics Information Services Proprietary Data Credit Bureaus Financial Data | |
| 2025 Q3 |
AIAI has been integrated into RGA's research process through tools like NotebookLM, Gems in Gemini, and Claude Code. The firm views AI as a force multiplier for human judgment rather than a replacement, emphasizing the Kasparov Law principle. They believe the market narrative around AI displacement is swinging to unhelpful extremes, creating investment opportunities. |
Machine Learning Automation Software Productivity Innovation |
GoldGold returned +65% in dollars in 2025, driven by broadening demand from central banks, professional and retail investors. Central banks now hold 24% of reserves in gold versus 23% in US Treasuries for the first time. Maintained 12% portfolio allocation throughout the year. |
Central Banks Reserves Diversification Demand |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Jan 18, 2026 | Fund Letters | Sebastian Lyon | FISV | Fiserv, Inc. | Information Technology | Data Processing & Outsourced Services | Bear | New York Stock Exchange | earnings reset, Execution, exit, Governance, Payments | Login |
| Jan 18, 2026 | Fund Letters | Sebastian Lyon | DGE LN | Diageo plc | Consumer Staples | Distillers & Vintners | Bear | New York Stock Exchange | brands, consumer staples, Consumption trends, Returns, turnaround | Login |
| Jan 18, 2026 | Fund Letters | Sebastian Lyon | LSEG LN | London Stock Exchange Group plc | Financials | Financial Exchanges & Data | Bull | New York Stock Exchange | AI, Data, Derating, Exchanges, Moats | Login |
| Jan 18, 2026 | Fund Letters | Sebastian Lyon | EXPN LN | Experian plc | Industrials | Research & Consulting Services | Bull | New York Stock Exchange | AI, Credit data, Moats, productivity, valuation | Login |
| TICKER | COMMENTARY |
|---|---|
| AMZN | One company we own that we think has unique positioning to benefit from both the infrastructure and application layers is Amazon. Amazon's logistical prowess is one of the foremost moats in business today and it can and will be enhanced with AI. The company will do this in multiple ways, with better orchestration of its logistics assets and underlying cargo, as well as the buildout of more capable, sophisticated and robust robotics. Amazon is singularly well positioned to dominate the coordination layer, with AI's help, across its entire logistics network. |
| DEO | Examples include Tidewater, Valaris, Constellation Brands, Diageo and Trex. We have discussed TDW and VAL previously, as well as STZ and DEO here. |
| EXPN.L | Experian's shares were -1% in 2025. Consistent with much of the rest of the portfolio, operating results remain solid. The company will almost certainly report double-digit growth in earnings for 2025, and the company has met or exceeded investors' expectations for the year. The challenges have not so much been financial but hypothetical – focussed on AI's potential to change competitive dynamics in their industry. Experian is valued on a prospective 4.5% equity FCF yield. We have added to the Strategy's investments this year. |
| FI | Notable detractors from performance came from Fiserv (-43bps absolute and -39bps relative) |
| 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. |
| LSEG.L | LSEG's shares were -20%. They are therefore illustrative of companies that have held back the Strategy's returns this year. Consistent with much of the rest of the portfolio, operating results remain solid. The company will almost certainly report double-digit growth in earnings for 2025, and the company has met or exceeded investors' expectations for the year. The challenges have not so much been financial but hypothetical – focussed on AI's potential to change competitive dynamics in their industry. LSEG is at 6.1% FCF yield. We have added to the Strategy's investments this year. |
| META | On January 9, Meta Platforms unveiled a new agreement with Vistra—the largest generator of competitive electricity in the United States—as well as with TerraPower and Oklo. The announcement builds on Meta's agreement last year with Constellation Energy and positions the company to become one of the largest corporate purchasers of nuclear-generated electricity in the United States. |
| 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. |
| 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. |
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