Portfolio & Market Review
A record breaking drawdown review and how to position for what comes next
These last few weeks have been historic. The latest drawdown in momentum and growth names was the largest since the 2008 crash.
This is something.
There’s lot of anger lately on social medias as moods follow volatility. These emotions are what make investing difficult, they force us to take rash decisions; but their real source is frustration. Large drawdowns make us doubt ourselves, our stock picking, strategy, execution… They happen because we did something wrong. What matters today is to define objectively what.
I’d also invite you to look back. We all gave back a lot of returns but most of our YTD should still be green, at levels reasonable investors would call excellent. My portfolio is still up 47% YTD and the stock‑picking portfolio is up 55.59% YTD.
We are only in July, there is strength in this market, room to find performance, and my system has already improved a lot this year. I know the next ones will be better. These are great times to learn and improve, not to cry over losses and give up. No one said this would be easy.
Now,
This market is sending tough signals. Late‑bull‑market vibes, crypto‑like swings... As I’ve said many times, we aren’t early and we should all acknowledge this.
The S&P isn’t in an awful spot. We’ve seen some distribution with rising volume on flat price action and lost supports, but we are still holding the D50 and the expansion we had in early June needed to breath a bit.
More worrying are the QQQ and SMH (the semi ETF), which both lost their D50 on higher volume; buyers weren’t strong enough to step up at those prices, and who can blame them when most analysts look at 2027 and 2028 expectations to value them… Buyers need some time there while strength is moving to other verticals.
This isn’t the only ETF taking a break. Most of the YTD winners are struggling: clean energy, power semis, space, robotics… Many are now sitting on their W50 and this feels like a make‑or‑break moment for them.
We’ve seen that good news – cold PPI & CPI plus with excellent hardware earnings, didn’t end up in green candles. That says a lot about risk appetite, and fits well with these names losing key trendlines.
But I wouldn’t be too bearish either. It does feel like a make‑or‑break moment but we’ve had lots of them over the last two years, and even if these were to break, some other sectors look much better. We’ll get into those, their leaders, what I expect from them, and the different pockets of strength and weakness.
Some notes on Kimi,
This is a DeepSeek‑like moment. K3 is the latest open‑source Chinese model which, on benchmarks, is slightly below the latest U.S. models.
Another Chinese models trained with less compute which competes with the most advanced western ones. This shouldn’t impact the market as we know since Deepseek that training can be optimized; the real narrative now is inference, which is why most of the returns have shifted from GPUs to networking as the needs are to meet massive compute demand as efficiently as possible, not train models.
This confirms that models are now raining, just like Nebius predicted, and aren’t the most important part of AI anymore, just like Karp said more than two years ago; what matters is the intelligence built on top of them. This is the current need for enterprises alongside speed and cost.
What we need today is optimized compute, energy and that layer of intelligence to meet current needs; we’re far from it but the market already anticipated parts of it, pricing success for speculative assets, which makes returns unlikely to happen where most look at.
Weakness & Strength
My focus this year was on a handful of sectors: mainly AI hardware, energy and space. Today, strength is shifting into healthcare and software, which is the logical next step of the AI trade.
But I wouldn’t throw the others away.
Space,
is the weakest sector. I exited entirely. I’m aware of the fundamentals and bull case, but as a concentrated investor I can’t hold weakness. My biggest worry is that even leaders like Rocket Lab are struggling. In this situation, the only question worth asking is.
Why didn’t buyers step up on improving fundamentals and a perfect trend retest?
There are millions of possible answers; one of them being “we are in July, investors are on holiday, we’ll go higher later”. But I have to play probabilities. So the valuable question is different, because the why rarely matters in the market, what matters is how to leverage the signals in front of you.
The data says fundamentals are improving (Iridium acquisition, accelerating launch schedules, growing revenues & more), and yet, it wasn’t enough for buyers to step up and defend a trend that hadn’t been lost in two years. So the question is.
Is it worth taking the risk of buying a broken downtrends?
This could be a fluke. I actually believe it is and that space stocks will make new highs before year‑end. But opinion is just a beautiful name for bias and I don’t invest on bias. I invest on signals, data, and probabilities.
Today, space isn’t giving the signals I need to be heavily involved. Bulls aren’t buying on key trends so I’d rather be somewhere else.
Photonics,
Photonics is showing more strength with leaders holding supports. We’ll talk about Soitec but I have other names to illustrate my point - Applied Opto, GlobalFoundries, Coherent… GlobalFoundries here as an example.
We all have different books, so we should treat signals differently. I learnt after buying space names a few weeks ago, that this kind of violent drawdown has to be treated carefully: a W50 retest can still fail and burn you. GlobalFoundries looks much better than Rocket Lab. Here you’d get a great price for an asset involved at the top of the photonics supply chain, received governmental grants from quantum, in a tight environment with massive demand and limited supply as confirmed by TSM.
If I had to play probabilities, I’d play them here, with a tight risk management.
AI Hardware names,
AI hardware names are a beast of their own. Yes, they are down a lot, but most were so extended that even these ~30% drawdowns haven’t brought them back to key supports. Many great accumulation areas on the sector, nothing else.
I have no more comment. These names are extremely strong, fundamentally and in price action.
Software,
slowly becoming my favorite hunting ground. I have a very long watchlist and most charts look like they’re in the early innings of bull trends after a massive beat‑down these last months.
The realization that models are only one part of the equation and that the intelligence and data layer built on top is the real value‑added will create winners with returns comparable to photonics names this year.
The companies that can provide real value at affordable cost will change the world.
It starts with cyber‑security and continues with data owners/companies that leverage data to provide those services, and will slowly expand to any kind of service, from B2C to more passive uses of AI.
Most cyber charts look like Qualys: the market suddenly realized AI was a tailwind and bought every cyber name, hard. There’s nothing actionable here for me, but I flagged those names weeks ago; some of you hopefully got some returns.
I’ll need to be patient to get setups I can buy – I already found one this week, but I know many will come over the next months.
In brief,
Outside of space, most sectors and names I follow are still in uptrends, with leaders still leading and bulls stepping up where they should, which is why I wouldn’t panic.
I’d still be cautious and treat retests with tight risk management. My base case from here is consolidation, exactly like we had at the end of 2025, with a bounce from here as a possibility and a bear market my less likely scenario.
I’ll illustrate my base case with Nebius.
50% drawdowns are to be expected in growth names. What matters is that bulls step up where they should, just like they did back then. W50 were bought and held. As long as bulls step up on trends, there isn’t much to do but accumulate strong assets, with strict risk management.
What you see today on Nebius specifically is comparable.
If we consolidate like we did back then and see a few W50 retests, accumulation it is. If we bounce and push higher during earnings season, then great. But if bulls do not step up on the W50, we’ll be better off somewhere else. Consolidation can go on for months without being an issue, losing supports is an issue.
Do not exclude any scenario. Have your base case, expect the worst, and know in advance how you’ll behave in each.
My Portfolio & Positions
I made a lot of changes over the last few weeks, because I made a lot of mistakes. Just like any of us. But I learn from those; mistakes I used to make two years ago weren’t repeated, so I know I won’t repeat the ones I made these last two months.
Today, I own five positions: Silicom, Soitec, Meta, SolarEdge and UiPath, at 70% margin.
On Friday, I sold Tempus, ARKG and Arista, after selling Fluence, Intuitive Machines and AST SpaceMobile earlier. I already detailed the why for the last three, but not for the first three as those were done Friday post‑market, so let me go over them.
Tempus lost its W21 on Friday. That’s weakness; small, but in today’s market it has to be punished. I didn’t do this a month ago and it cost me a lot, so I adapt and factor the environment into how I manage positions.
This isn’t a bad chart and the healthcare thesis remains strong. But I have a better thesis elsewhere and needed liquidity. This was also the reason to close ARKG: I needed cash for my latest position.
I still consider Arista one of the best AI hardware stock on the market. Fundamentals are perfect, management is perfect, narrative is perfect, chart is perfect, behavior is perfect… I don’t think you can ask for a better name.
The reason for selling was the same. As a concentrated investor, I need to concentrate. I could keep a foot in Arista and build a 30‑stock portfolio, post screenshots of my 2% positions up 100% and brag on social media. But that’s not why I’m here. I’m here to increase my net worth, and that doesn’t happen with 2% stakes in 50 great stocks. It happens with 30% stakes in one.
As I said, I’ve received a lot of criticism lately on my new positions and sales. I don’t do it because I enjoy paying transaction fees, but because I try to find the best proxy for net‑worth increase, that requires concentration, which requires decisions – including cutting clear winners to buy what I see as higher potential.
Arista is a clear winner. But have you seen UiPath?
My Positions
I already went through the fundamentals a few months ago; I had the wrong timing then but the narrative hasn’t changed since, it improved, and timing is better. I’ve rarely seen such volume on any stock, and that justifies rotating liquidity into it.
Something is happening in this stock. I have no idea what exactly, but there is a lot of buying – shares and options, and the market bought it during one of the most violent downtrend of momentum driven stocks. I’ll be in as long as supports hold.
Soitec had an interesting week, closing positive – like many photonics names, with buyers stepping up heavily on its W50.
The stock is down 50% from its yearly high and my first trim, and 17% since I refilled my shares. I’m still satisfied with how I managed this position and am being patient, as I expect a Nebius‑like consolidation. It became my smallest position not because of a lack of conviction, just drawdown and patience before buying more. Environment is tight and I’d rather see strength before increasing the position, for now the stock is being rejected at every daily average retest.
The fundamentals are unchanged and unrelated to CPO delays; SOI wafers are needed for any kind of optical connectivity and are under massive demand. It’s just a matter of liquidity allocation and patience. I’ll gladly make it my largest position again once it reclaims its daily averages, and I’d cut the position if it were to lose its support.
Silicom is somehow uncorrelated to its sector, to my great pleasure. It’s also cheap considering latest news and demand for its hardware.
There is only one possible interpretation for a stock behaving better than its sector: that buyers are stepping up in size. The market sees something and buys it, while selling the rest of its sector.
I see the same thing.
Meta chose my best‑case scenario: it gave us a breakout retest and closed its gap. From my thesis write‑up:
We had our ~$640 retest, it was bought, and now we wait to see what happens. I still consider Meta the best AI name on the market here.
Lastly,
I talked about Bitcoin and Ethereum with alerts for Founding Members and trade plans in articles. Both behaved well these last weeks and I’m still holding both. I didn’t include them in the portfolio above because they are a different pocket of liquidity – just like I don’t include my bank account as cash.
If I had to choose between crypto and stocks, I’d buy stocks. But I don’t have to. And seeing Ethereum’s chart, knowing no one is positioned… I might buy it even before some stocks.
We still need confirmation of an uptrend – clear higher highs and larger volume, we aren’t there just yet… But considering the crash on some sectors, seeing crypto hold daily averages for weeks with higher highs is interesting. I’m positioned on margin and getting paid in funding. You rarely get paid to be leveraged in crypto; the few times I’ve seen this were moments before big pushes. Invalidation happens if we lose those daily averages.
It might not push higher today, nor this week, but I’d keep a close eye on cryptos over the next weeks and months.
As usual,
I will share every transaction in the chat with Founding Members, whether purchases or sales, whether controversial or not. We’ve had many interesting conversations over the last few weeks; great advice, questions and interactions.
A lot of value added.
A few last words,
Again, the last few weeks were draining. That’s what we signed up for.
I’ve expected a bounce for a few days now and Friday might have been the first sign of it. I expect it to be just a bounce for weak names and would use to cut them, not to reinforce a “I knew it, we’re so back” bias. There’s always a bull run somewhere; there’s no point holding weakness and hoping for the least probable scenario while you can concentrate on the best ones; names that were green over the last weeks should over perform in the event of a bounce, and continue higher later on.
We are entering the heart of earnings season. I expect everything to point in the same direction: more hardware, more capex, more spending, and software slowly proving that AI is a tailwind. Nothing different fundamentally. The real signal will be how the market reacts to the news in each sector.
No selling on bad news is bullish.
Selling on good news is bearish.
Disclaimer: I am not a licensed financial advisor, analyst, or broker. This content reflects my personal opinions and investment decisions for informational and educational purposes only. I hold positions in securities discussed and may buy or sell without notice. Nothing here constitutes a recommendation to buy, sell, or hold any security. Past performance does not guarantee future results.
Always conduct your own research and consult a qualified professional before making investment decisions. I accept no responsibility for any financial losses.
regarding path. what options are you specifically in?
Loved it. I don't necessarily agree with everything and I chose to hold on to some of the positions given my threshold for pain, but can't argue with rotation and concentration there.