Here's my 1-page mental model for understanding the semiconductor ecosystem👇 Covering: - design software $Cadence Design(CDNS)$ $Synopsys(SNPS)$ - equipment $ASML Holding NV(ASML)$ $Lam Research(LRCX)$ $KLA-Tencor(KLAC)$ - chip designers $NVIDIA Corp(NVDA)$ $Advanced Micro Devices(AMD)$ - chip manufacturers $Taiwan Semiconductor Manufacturing(TSM)$ $Texas Instruments(TXN)$ $Mi

Portfolio at the end of December and the end of 2023. No new positions.2023 performance: 31.1%5yr FCF per share CAGR = 20% FCF ROC = 32% FCF Margin = 34% FCF Yield = 3.34% Share price linearity (5yr) = 0.87ImageThere were no outright sales or purchases. The top contributors to performance were $Alphabet(GOOG)$ $Alphabet(GOOGL)$ and $ASML Holding NV(ASML)$ . $Microsoft(MSFT)$ was the only detractor from performance.My best performing stocks this year have been $NVIDIA Corp(NVDA)$ $Fair Isaac(FICO)$

10 of the 12 companies I invest in are listed in the US.But only 44% of their revenue is derived from North America. $Fair Isaac(FICO)$ has the most US exposure, while $KLA-Tencor(KLAC)$ has the least (27% China, 24% Taiwan, 18% Korea).You can be globally diversified just by owning US stocks. $Fair Isaac(FICO)$ $Novo-Nordisk A/S(NVO)$ $Constellation Software, Inc.(CONSF)$ $Microsoft(MSFT)$ $Cadence Design(CDNS)$ $MSCI Inc(MSCI)$

Asset LIGHT businesses generally outperform capital INTENSIVE businesses.Some of the best ratios for screening for asset light businesses are:- high return on tangible assets- low physical assets as a percentage of total assets- low CAPEX / OCF- margin expansionWhat would you add to this list?For whom haven't open CBA can know more from below:🏦 Open a CBA today and enjoy privileges of up to SGD 20,000 in trading limit with 0 commission. Trade SG, HK, US stocks as well as ETFs unlimitedly!Find out more here：Trade on a Cash Boost Account and enjoy up to 6 months of Commission-Free trading.💰Join the TB Contra Telegram Group to Get $10 Trading Vouchers Now🎉💰CBA Mini Course 1: What is Cash

Three reasons why very few companies are capable of sustaining a high return on capital over a long period of time:1. Economic downturns - few companies are resilient to these due to exposure to commodities and interest rates (eg banks and energy companies).2. Reinvestment opportunities - companies lacking reinvestment oppportunities typically pay out a large chunk of their earnings as a dividend, rather than reinvest (eg consumer staples).3. Pricing power - few companies are capable of raising prices without losing sales to their competition.ImageValuation reflects both future growth and current multiple. I personally focus on future growth. I see a lot of value currently in $Applied Materials(AMAT)$ and $Fo

Fundsmith’s factsheet says no sales or purchases this month.We know from their 13F that they bought Edwards Lifescience Could this be for their Smithson fund instead?$Sabre(SABR)$ $VeriSign(VRSN)$ $Fortinet(FTNT)$ $Masimo(MASI)$ $Qualys(QLYS)$ $Verisk Analytics(VRSK)$ $MSCI Inc(MSCI)$ $Cognex(CGNX)$

Here's our factsheet for November.FCF ROC = 27%FCF Growth = 17%FCF Margin = 25%FCF Yield = 2.53%November return = 2.3%YTD = -17.4%Sartorius Stedim Biotech was sold due to valuation concerns (FCF yield = 0.4%) and was replaced with the Italian immunodiagnostics company Diasorin.Adobe$Adobe(ADBE)$ and Nemetschek$Nemetschek AG(NEMTF)$ were replaced with Paychex$Paychex(PAYX)$ and TechnologyOne$Technology One, Ltd.(THNOF)$ . This maintains our SAAS exposure, but increases the predicability and stickiness of their FCF.Here's a snapshot of the portfolio's valuation.$Visa(V)$

Over the last 15 years, quality investing has outperformed value investing.• The MSCI's quality index has an average outperformance of 2.71%, compared to -2.32% for their value index.• Quality has outperformed in 11/15 years, while value only managed 5/15 years.• Quality delivered the lowest volatility (SD=4.36%).Critics may argue that 15 years is a short time frame, but the consistency and lower volatility speaks for itself. $S&P 500(.SPX)$ $SPDR S&P 500 ETF Trust(SPY)$ $Invesco QQQ(QQQ)$ $NASDAQ 100(NDX)$ $Dow Jones(.DJI)$ ImageYear 1 - you invest $20 and make $10Year 2 -

What are the highest quality companies in the Fundsmith/Smithson investable universe?I took the complete set of holdings from both funds and ran it through one of my custom quality filters.Here are the ones that rise to the top 👇🏼👇🏼 $Nemetschek AG(NEMTF)$ $MSCI Inc(MSCI)$ $Qualys(QLYS)$ $IDEXX Laboratories(IDXX)$ $Mettler-Toledo(MTD)$ $Microsoft(MSFT)$ $Novo-Nordisk A/S(NVO)$ $HMS Networks AB(HMNKF)$ $Technology

Portfolio at the end of November 2024November performance: +8.8%YTD: 27.6%We began a new position in ATOSS Software. The top contributors to performance were $Fortinet(FTNT)$ and $Fair Isaac(FICO)$ . The top detractors from performance were $KLA-Tencor(KLAC)$ and $Applied Materials(AMAT)$ .FCF ROC = 38%FCF per share CAGR (5yr) = 24%FCF Linearity (5yr) = 0.94FCF Margin Expansion (5yr) = 6%FCF Yield = 2.73%ImageTake a look at the below table. AMAT and KLA have higher and more consistent FCF per share growth. $ASML Holding NV(ASML)$ generally has lower returns on capital and higher

What influences share prices?Here’s my mental model for understanding equity markets.In corporate finance there are three rules for maximising value: 1. Buy high return assets 2. Finance assets with low cost debt 3. Only return capital to investors if there are no suitable investments These principles should guide both how managers run their businesses and how investors find and manage investments. Maximise the highest possible return by investing in the highest returning assets.What would you add?https://twitter.com/long_equity/status/1634308890622849030

Quadrants are a really effective tool for categorising companies. The below quadrant compares market share and market growth. I look to invest in the top row, ideally the top right corner.What companies would you add that have the market share of a growing market?ImagePricing power is essential for long term compounding. I look for 3 things:1. High margins - is the company adding a large up to what they sell?2. Market share - if the company has the market share, then there’s no alternatives for customers to pick from.3. Their customer’s income statement - if the product or service is a low expense for the customer, then they’re unlikely to cut back on buying it during a downturn.What would you add?For whom haven't open CBA can know more from below:🏦 Open a CBA today and enjoy privileges of

Here's how the constituents of the S&P 500 $.SPX(.SPX)$ differ based on their growth rate and the linearity of that growth.I invest in the top right, where growth is high and predictable.ImageWhen analysing a company, consider where its product/service fits in its customer’s income statement. I personally target essential spending, ideally related to OPEX and maintenance CAPEX.ImageTwo things you can do to become a better investor: 1. Limit the number of companies you own 2. Limit how frequently you trade This forces you to: 1. Only own your best ideas 2. Accept there will always opportunities you miss out on

Portfolio at the end of April 2024.April performance: -5.7% YTD performance: 11.0%FCF ROC = 35%FCF per share CAGR (5yr) = 22% FCF linearity (5yr) = 0.90FCF Margin Expansion (5yr) = 5%FCF Yield = 2.95%Interest expense = 6% of operating profit Change in share count (5yr) = -9%If FCF per share keeps growing in the high teens, then it’s a fair price to pay for quality.There were no outright sales or purchases. $Novo-Nordisk A/S(NVO)$ was the only contributor to performance. The top detractors from performance were $MSCI Inc(MSCI)$ and $Cadence Design(CDNS)$ .Imagehttps://twitter.com/long_equity/status/1785424822237106511

Here are the holdings of the BlackRock Unconstrained portfolio.I’ve highlighted the companies that I own and would invest in.Any thoughts on the portfolio? $Novo-Nordisk A/S(NVO)$ $ASML Holding NV(ASML)$ $Alphabet(GOOG)$ $Alphabet(GOOGL)$ $Ansys(ANSS)$ $Cadence Design(CDNS)$ $Intuit(INTU)$ $MasterCard(MA)$ $Microsoft(MSFT)$ $S&P Global(SPGI)$

UPDATED: Here's the latest Global Compounders Database. New names in pink.What would you add or subtract?ImageFor whom haven't open CBA can know more from below:🏦 Open a CBA today and enjoy privileges of up to SGD 20,000 in trading limit with 0 commission. Trade SG, HK, US stocks as well as ETFs unlimitedly!Find out more here：Trade on a Cash Boost Account and enjoy up to 6 months of Commission-Free trading.💰Join the TB Contra Telegram Group to Get $10 Trading Vouchers Now🎉💰CBA Mini Course 1: What is Cash Boost Account(CBA)?

Monopolies $Taiwan Semiconductor Manufacturing(TSM)$ - advance semi fab $ASML Holding NV(ASML)$ – EUV lithography $VeriSign(VRSN)$ - domain name registry $Fair Isaac(FICO)$ – credit scores $Intuit(INTU)$ – tax preparation software $Thermo Fisher Scientific(TMO)$ – ultra-high-end mass spec $Illumina(ILMN)$ – high-throughput DNA sequencing $CoStar(CSGP)$ – U.S. commercial real estate data $Sherwin-Williams(SHW)$ –