Beating the market with concentrated winners and tight loss control

Conviction: 75% · Horizon: 3Y · 2026-07-02
Outperformance comes from sizing a few large winners and preventing any single loser from materially dragging returns

A practical path to strong annual returns is one or two positions sized at roughly 10% or more of the portfolio that work, combined with discipline so no holding costs more than about 2% of total capital. In many environments, finding ideas that can double is not the main constraint; capturing gains through sizing and cutting mistakes early—such as exiting a lagging name whose opportunity cost equals a doubling of a mid-sized position—is often what separates analyst skill from investor results.

Instrument Side Target Reason
FEC.TO Long Among the highest value-add trades in the period alongside a completed takeover winner, this name reflects deliberate sizing and selection when the catalyst and valuation align, consistent with a portfolio approach that relies on a small number of large, well-researched positions rather than broad diversification.

Themes

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