🚨Trade Alert 16: Exiting Two Positions And Opening Two New Positions

Exiting two positions that worked incredibly well to fund two new opportunities.

Last month was incredible for us.

Our portfolio reached all-time highs, one position became a 10x-bagger, while another became a 5x-bagger, and we had opened these positions just a year ago in 2025.

Result? Our margin of outperformance reached 30%, and TTM performance reached 58%.

Just as I was thinking that it couldn’t get any better, it got better.

A high conviction position we opened earlier this year has officially doubled after going up ~20% on Monday. I got many kind messages for this from our readers, and I want to take this as an opportunity to thank everybody who sent these messages.

This is, of course, great, but it’s not without challenges.

As a result of their stellar performances, many positions in our portfolio have now gone well beyond their fair values, leaving us with limited & speculative upsides and pretty stretched downsides.

And this comes at a time when stock valuations are at all-time highs:

So, it’s challenging to find new, undervalued positions in which we can put proceeds from our overvalued positions. Yet, they exist.

Interestingly, I see many more opportunities than I would normally expect to see when the market is at this valuation.

This is because the incredible market performance since 2022 has created an insane amount of FOMO. Yet, people are also aware that valuations across the board are high, and we may be nearing the end of this cycle. Thus, everybody is trying to find stocks that can go up +100% in a short period of time.

That fundamentally changes the game from one of valuations to one of predicting what people will concur to buy next, and narratives are the vehicles creating these concurrences.

As a result, names that have positive narratives behind them go up no matter how high their valuations already are, and names that don’t have these narratives or have weaker narratives lag in price regardless of their quality and low valuations.

This is illustrated by the fact that the S&P 500 without AI is actually lower since the start of the Iran War:

This means the breadth is actually very low, and higher valuations are a making of a handful of high-flying stocks, not a market-wide phenomenon.

This is why there are still very high-quality businesses trading at attractive prices.

Today, we’ll reposition the portfolio to capitalize on these opportunities by:

• Exiting two well-performing positions that have become pretty overvalued.

• Buying two high-quality undervalued positions instead.

This way, a substantial part of the portfolio will have its profile change from “limited upside-stretched downside” to “limited downside-high upside.” So, we’ll have a better shot at beating the high bases set by those well-performing positions and keep advancing the portfolio performance in the remainder of the year.

I’ll be explaining the trades below, and you’ll also find the link to the portfolio spreadsheet at the end of the write-up. I’ll be updating it after I execute the trades.

So, let’s get started.

Here are the exact trades I am making:

Let’s start with one of the most obvious trades I currently see in the market.