Wiedower Capital 1H’18 Investor Letter

Texas-based investment firm Wiedower Capital reported gaining 2.72% net of fees in the first six months of 2018, according to the firm’s H1’18 investor letter.

In the letter to investors, Managing Director Travis Wiedower said that Wiedower Capital focuses “on the highest-quality companies and CEOs that have industry tailwinds behind them and long runways for growth ahead of them.”

“Research is focused on how an industry may evolve over the next 5-10+ years and if a company’s competitive advantage can expand within that evolution. Qualitative factors are emphasized over quantitative, and the portfolio is concentrated with long holding periods,” according to Wiedower.

Wiedower stated:

I’ve also come to accept that I don’t enjoy the actual process of buying and selling stocks. I don’t like checking stock prices and volume, placing orders, and keeping up with trades. Hell, I don’t even like opening Interactive Brokers. Sometimes I go weeks without logging into Interactive Brokers and that’s perfectly fine by me. Buying and selling positions is a major mental distraction and it takes me away from what I enjoy most—researching and learning. I enjoy holding investments a lot more than I like buying or selling them. Thus, a concentrated portfolio of companies that we can own for many years is more my style.

Finally, having a portfolio of long-term positions results in less pressure for action. If we own ten stocks with an average holding period of 1-2 years, I have to find a new company to invest in every 1-3 months on average. That’s basically nonstop pressure to find new investments—and I’ve struggled with that pressure before.

Alternatively, if we own ten stocks and the average holding period is between five and ten years, now I only have to find one new investment every 6-12 months on average. Finding a new company to invest in every 6-12 months as opposed to every 1-3 months is a significant decrease in pressure. I hope that having less pressure to find new companies results in higher quality investments when they are made.

You can download a copy of the letter here.