Markets, made clear.
Five principles shape everything in the portfolio. They are simple to state, much harder to follow consistently, and they are the closest thing I have to an edge.
- 01
Free cash flow is the north star.
Earnings can be managed; cash cannot. I value businesses on what they actually generate, not on what they are allowed to say about themselves. Free cash flow yield beats P/E in almost every context that matters.
- 02
The macro is the map, the stock is the destination.
Secular themes — energy transition, commodity supercycle, deglobalisation — are the hunting ground. But I never hold a theme. I hold a specific, undervalued company inside that theme, with a balance sheet that lets it survive the wait.
- 03
Conviction is sized, not whispered.
If I genuinely believe in a position, it must show up in the portfolio weight. Concentration is not recklessness — it is what conviction looks like in practice. The opposite — over-diversifying into things I don't really believe in — is the more common mistake.
- 04
Patience is the edge.
Most of the return comes from not doing things. Holding through drawdowns when the thesis is intact. Not chasing the rotation. Not selling a compounder because it had a quiet year. The market pays for patience because so few investors can supply it.
- 05
Honest about being wrong.
The best investors I've read are the ones who write about positions that didn't work. Post-mortems are the highest-trust content on this site and the most useful private exercise I do.
The guardrails. Everything above happens inside three hard limits: no leverage, no short selling, no derivatives. They cost return in good years and save the portfolio in bad ones. In seven years they have never been broken, and they won't be — a strategy you can copy with confidence is one whose rules don't bend when it's tempting.