26 January2025
Performance
HVG portfolio returned +14.1% in 2024 (in USD terms, including dividends). Since 2000, the portfolio has gone up 77.3% or 15.4% on an annualised basis.

The results are mixed. On the one hand, solid double-digit returns are within my long-term objective of generating 10-20% annualised returns through the cycle. The extra focus on not losing money by having a substantial cash position and more defensive stocks almost ‘guarantees’ underperforming broader indices when markets are particularly strong. Besides, half of the HVG portfolio was invested in international stocks, which significantly lagged the S&P 500.
On the other hand, with a relatively small portfolio size and the rise of passive strategies, one can expect better opportunities for diligent private investors to generate stronger results.
Here are the details of individual stock performance in 2024.
On the other hand, with a relatively small portfolio size and the rise of passive strategies, one can expect better opportunities for diligent private investors to generate stronger results.
Here are the details of individual stock performance in 2024.

The difference between 18.2% and 14.1% in the table above comes mostly from negative FX changes as the performance of individual stocks is calculated in local currency, while total portfolio performance is reported in USD. Other factors include the impact from positions that were closed during 2024 and are not shown in the table.
From here, a usual value investor letter would talk about market excesses and numerous signs of bubbles, such as the proliferation of meme coins, market concentration, disappearing equity risk premium, and extreme weight of US stocks in global markets.
I will spare you the details as they are widely available. It is important to understand the macro context, but it is much more important to accept that long-term results from owning stocks come primarily from the underlying performance of individual companies in the portfolio. You can either add value by timely switching between different stocks and asset classes or by identifying exceptional companies and holding them tight as long as fundamentals remain strong.
From here, a usual value investor letter would talk about market excesses and numerous signs of bubbles, such as the proliferation of meme coins, market concentration, disappearing equity risk premium, and extreme weight of US stocks in global markets.
I will spare you the details as they are widely available. It is important to understand the macro context, but it is much more important to accept that long-term results from owning stocks come primarily from the underlying performance of individual companies in the portfolio. You can either add value by timely switching between different stocks and asset classes or by identifying exceptional companies and holding them tight as long as fundamentals remain strong.
Portfolio Strategy
The portfolio follows the barbell strategy with a strong foundation of low-risk businesses such as Berkshire Hathaway, Exor and Loews, complemented by a handful of high-risk/high-return investments. The first group acts like an anchor during the storm, while the second group adds critical growth and valuation re-rating potential.
Rebalancing between the two groups is another essential element of the strategy. For example, in a downturn, the share of riskier investments in the portfolio will decline (as they fall more than the defensive names), which provides an opportunity to increase exposure to this riskier group at lower prices using relatively more expensive defensive stocks as the funding source.
There are two goals HVG aims to achieve.
Firstly, to own great businesses priced at a discount, benefiting from returns on capital that these businesses generate with an additional upside coming from potential share price re-rating. Secondly, to avoid heavy losses and to have flexibility to increase investments during market turbulence.
To achieve the second goal, I keep a high weight of low-risk companies with strong liquidity (almost 60%) and extra cash (9% weight at the end of Q4 2024).
Such an approach inevitably leads to underperformance during bull markets: cash and more defensive stocks drag down the portfolio when the best market performers are high-beta stocks. However, I expect such a portfolio to deliver better results over the long term as the portfolio has the resources that can be deployed in a downturn.
One of the changes I plan to implement in the following several months is to consolidate some of my smaller holdings by increasing their weights to 5% and potentially 10%. By exiting other small positions, I plan to have a more concentrated portfolio with less than 20 stocks.
Rebalancing between the two groups is another essential element of the strategy. For example, in a downturn, the share of riskier investments in the portfolio will decline (as they fall more than the defensive names), which provides an opportunity to increase exposure to this riskier group at lower prices using relatively more expensive defensive stocks as the funding source.
There are two goals HVG aims to achieve.
Firstly, to own great businesses priced at a discount, benefiting from returns on capital that these businesses generate with an additional upside coming from potential share price re-rating. Secondly, to avoid heavy losses and to have flexibility to increase investments during market turbulence.
To achieve the second goal, I keep a high weight of low-risk companies with strong liquidity (almost 60%) and extra cash (9% weight at the end of Q4 2024).
Such an approach inevitably leads to underperformance during bull markets: cash and more defensive stocks drag down the portfolio when the best market performers are high-beta stocks. However, I expect such a portfolio to deliver better results over the long term as the portfolio has the resources that can be deployed in a downturn.
One of the changes I plan to implement in the following several months is to consolidate some of my smaller holdings by increasing their weights to 5% and potentially 10%. By exiting other small positions, I plan to have a more concentrated portfolio with less than 20 stocks.
Comments on individual positions
I have grouped the companies into different sections based on their performance.