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Quarter	Letter Date	Fund Name	QTD	YTD	Tickers	Themes	Quick Take

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Olesen Value Fund 2023 Q3 Investor Letter | Buyside Digest

Back to Fund Profile (Olesen Value Fund)

Primary Source Intelligence • Q3 2023 Letter Analysis

Olesen Value Fund Quarterly Analysis

Buyside Digest is not affiliated with, and does not endorse, Olesen Value Fund. This analysis is provided for institutional research purposes only and is not investment advice.

Fund Returns

QTD-2.9%

YTD-5.1%

Annualized+12.3%

Positioning StanceConstructive

Market CapSmallCap

GeographyGlobal, Europe, US

Digest Analysis

Quick Take

"Value-focused manager reduced bank exposure after selling Goldman Sachs, while adding European small cap at deep discount during cyclical downturn. Portfolio includes exceptional banks trading at 9x earnings despite strong fundamentals."

Executive Summary

Olesen Value Fund lost 2.9% in Q3 2023 but continues to outperform since inception with 12.3% annualized returns versus 10.3% for global markets. The manager made a new investment in a European small cap company facing cyclical headwinds, purchasing at 0.81x tangible book value and 6-7x mid-cycle earnings. He reduced bank exposure as a risk management decision, selling Goldman Sachs for a 12% IRR after determining the allocation was too high. The fund maintains positions in three exceptional banks with strong management and ownership stakes, trading at an average 9.0x P/E despite good growth prospects. One portfolio company completed an accretive acquisition at 4.7x after-tax earnings. The manager focuses on managing exposure to permanent capital loss while concentrating in opportunities with the best reward-to-risk ratios. With 100% of his own investable assets in the fund, he emphasizes long-term value creation through disciplined opportunistic investing.

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Institutional Meta Strategy

Meta Strategy Gauges

Algorithmic conviction, macroeconomic posture, and risk appetite signals extracted from this quarterly letter with qualitative explanations.

Signal Matrix

Market Conviction

72%

CautiousHigh

High Conviction (72%)

High conviction evidenced by 100% of manager's own investable assets in the fund, specific position sizing decisions (reducing banks to 25% max loss), and detailed fundamental analysis of individual holdings with clear valuation metrics.

Growth Outlook

25%

BearishBullish

Bearish (25%)

Manager shows mild optimism about specific opportunities, particularly the new European small cap investment and remaining bank holdings, but acknowledges cyclical headwinds and maintains cautious positioning.

Risk Appetite

38%

DefensiveAggressive

Defensive (38%)

Manager reduced bank exposure as a risk management decision and explicitly focuses on managing exposure to permanent loss of capital, indicating a more defensive positioning despite maintaining concentrated investments.

Capital Deployment

43%

De-riskingDeploying

Net Neutral (43%)

Net slight de-risking as manager reduced bank exposure and sold Goldman Sachs, though this was offset by new European small cap investment. Overall represents risk management rather than aggressive deployment.

Forward Guidance

15%

CautiousExpansionary

Cautious (15%)

Manager expects current investments to be lucrative and believes the European small cap will handle the cyclical slowdown well, showing mild deployment bias toward quality opportunities at attractive valuations.

Language Signal

10%

BearishBullish

Bearish (10%)

Language is balanced with terms like 'bargain price,' 'very lucrative investments,' and 'strong fundamentals' offset by 'cyclical headwinds,' 'disappointing performance,' and risk management concerns.

Perceived Risk

65%

Low RiskElevated

Elevated Risk (65%)

Manager explicitly discusses tail risks including extremely severe financial crisis, acknowledges cyclical headwinds, and made risk management decisions to reduce bank exposure, indicating meaningful risk awareness.

Opportunity Density

60%

ScarceAbundant

Selective (60%)

Manager found attractive new investment in European small cap and sees value in remaining bank holdings, but also notes the need for selectivity and moved away from less attractive opportunities like Goldman Sachs.

Time Horizon

75%

Short-TermLong-Term

Decade+ (75%)

Manager demonstrates multi-year patience with cyclical investments, expects European small cap to recover after downturn, and has held bank positions through multiple cycles, indicating 2-5 year investment horizon.