First, how did 2025 go? Not great, actually. The result was a decline of 3.8 percent in SEK. I am not happy with that. However, currency movements was a major factor and Swedish based Global funds didn't have a particularly good year either. But owning stocks in Indonesia certainly hasn't helped. Indonesia was a real drag on the portfolio - the combination of stock price and currency movements was a small disaster.
The stocks in local currency
- AS Company 45% +4% yield
- Primeserv +24% +6% yield
- RFM Corp +22% + 10% yield
- Argent +19% +4% yield
- Karooooo +1% +2% yield
- Champion Pacific -8% +1% yield
- Ekadharma -13% +5% yield
- Ultrajaya -20% +3% yield
- Arwana -23% +8% yield
- ZAR to SEK -5%
- EUR to SEK -6%
- USD to SEK -17%
- PHP to SEK -18%
- IDR to SEK -19%
But the year has been good in the long term, despite a poor return. I am really happy to have found my investment style: global, concentrated, deep-value investing in undiscovered stocks with rock-solid balance sheets. I have confidence in my nine holdings and am looking forward to a stronger 2026.
I demand more
2025 was a year of change. I evolved and will demand more. More is less risk. More focus. More value. Cheapness is good. Extreme cheapness is best: No-analyst stocks, but no-brainers if you just care to look at P/E, EV/EBITDA, FCF-yield and their large cash piles. No trigger or catalyst is needed if the valuation is more than right. A CAGR of 12–15% from each holding should be possible; a stable 5–10% might be nice, but it's not good enough. As a rule of thumb I aim to own stocks that are cheap, even if they double!
During the year, I sold companies where the quality or valuation was not right compared to the other parts of the portfolio. Price and potential are the most important factors. It's that simple. A company should be significantly undervalued to be worth owning. I demand greater undervaluation than before! This requires more monitoring. Are good returns still possible with reasonably defensive assumptions?
The bulk of the portfolio is value/deep value, but there are also some stronger growth elements (e.g. Karooooo). In this case, the mispricing is real if you consider their market position as a leader in South Africa and believe they could succeed in Asia and Europe while South Africa continues to grow. I expect growth. But it's important to note that this is not "new" or "extraordinary" growth, just continued growth. And growth at a very reasonable price.
The labels
I own Deep Value. That's stocks that could double in value and still be considered cheap. These make up the bulk of the portfolio (eight out of nine stocks). I also own GARP-like stocks, but I prefer GAVRP (growth at a very reasonable price). I am now also a focused, concentrated investor. That's what I learnt in 2025, or rather, what I have gradually evolved into. I'm not that interested in "buy and hold", unless the company and its valuation still justify a purchase. I discovered that this style suits me.
If you read the history of the blog, you will see that I found my investment strategy in spring 2021. I look for small companies, cheap companies with low free float. What happened in 2025 was the next step. More focus and even more value. However, the next step could be easier to misstep, but that's a risk I am willing to take!
The changes
The changes are real this year. Simplified it's just increases in Argent, Primeserv, RFM (really fat pitches). And I sold things that was more expensive or where quality was lacking.
- Companies > from 14 to 9. Due to quality and/or valuation.
- Portfolio size > outsized bets is OK.
- Some favorites, long term holdings were sold.
