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| Quarter | Letter Date | Fund Name | QTD | YTD | Tickers | Themes | Quick Take |
|---|---|---|---|---|---|---|---|
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"Micro-cap value specialist focusing on Hong Kong's severely depressed market where 40+ positions offer exceptional value with minimal competition. Manager continues aggressive buying despite ongoing declines, viewing current conditions as creating rare opportunities for patient fundamental investors while avoiding AI-driven US tech speculation."
Comus Investment returned -3.06% net in Q2 2023, underperforming major indices as US tech stocks continued their AI-driven rally. Manager Aaron Saunders specializes in micro-cap value investing, owning 40 Hong Kong micro-caps out of approximately 1,000 available, plus select special situations in other markets. Hong Kong represents his core opportunity, having declined in five of the last six years with 40%+ total losses, creating what he views as exceptional value with minimal competition. The manager continues buying aggressively despite an additional 8% quarterly decline, seeing bottom-up improvement while prices remain depressed. He trimmed Japanese positions to fund Hong Kong purchases but maintains some Japan exposure for potential yen strengthening. The strategy explicitly avoids US tech mega-caps and AI speculation, which he views as disconnected from fundamentals. The fund provides uncorrelated exposure through micro-caps that behave uniquely compared to major indices, focusing on turnarounds trading below net cash where fundamental analysis can identify mispriced opportunities.
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Algorithmic conviction, macroeconomic posture, and risk appetite signals extracted from this quarterly letter with qualitative explanations.
Market Conviction
High conviction demonstrated through concentrated 40-position Hong Kong portfolio, continued aggressive buying during declines, and willingness to trim other positions to fund core strategy. Clear specialization thesis with specific market focus and contrarian positioning.
Growth Outlook
Manager acknowledges challenging conditions with Hong Kong in severe bear market and US tech disconnected from fundamentals, but frames Hong Kong's weakness as creating opportunities rather than expressing broad market pessimism.
Risk Appetite
Positioned aggressively in Hong Kong micro-caps with 40 positions and continuing to buy more despite declines. Trimming other positions to fund additional Hong Kong purchases shows strong risk appetite in his specialty area.
Capital Deployment
Actively deploying capital by trimming Japanese positions to fund Hong Kong purchases and continuing to buy as much as possible in micro-caps despite price declines. Clear net deployment activity toward core opportunity set.
Forward Guidance
Plans to continue buying Hong Kong micro-caps and maintain selective exposure elsewhere. Positive deployment bias in his core area but measured approach to other markets shows moderate forward optimism.
Language Signal
Mixed language with negative framing of broader markets (bear market, scary place, worst performing) balanced by positive opportunity language (great prices, bottom-up improvement, exceptional value).
Perceived Risk
Acknowledges Hong Kong as scary place for foreign investors and notes AI speculation creating unfavorable environment, but frames these as manageable risks rather than systemic threats. Moderate risk awareness without alarm.
Opportunity Density
Sees abundant opportunities in Hong Kong micro-caps with 1,000 available names and minimal competition. Describes prices as great and continues finding new investments to purchase, indicating rich opportunity set in specialty area.
Time Horizon
Multi-year value investing approach focused on turnarounds and fundamental analysis. No urgency expressed about timing, with patient capital approach to buying during market weakness and holding through volatility.
