February 25 portfolio update
...and our brain's inability to think exponentially
Ciao ragazzi,
it is fair to say that February was an insane month. The speed at which things happen in AI and in geopolitics is hard to comprehend. Markets are super volatile and trending downwards and so is my portfolio. On top of discussing my trades of the month I wanted to focus on probably the most important questions in tech and stock markets these days: will AI deliver on its promises and will the demand for AI keep on growing?
“Of course, I don´t know” is the real answer but there are a few thoughts/ convictions that I would like to share:
The speed at which AI models are moving is truly breakneck. To understand this you have to try the products. Grok3 makes the first ChatGTP look like an idiot, if you tried them it´s obvious
The human brain is bad at extrapolating velocity slopes and thinking exponentially but if I try to project the rate of innovation of the last 2 years into 10 years in the future…impossible to quantify it but it just feels so massive
LLMs such as chatgtp focus mostly on text generation with key applications in learning, summarization, content creation and code generation but the next frontiers are much more exciting. Think about Agentic AI (an AI that can autonomously make decisions and complete real-world tasks) and Physical AI (AI applied to cars and various machines)
(NVIDIA CES 2025 presentation) we are just beginning to experience the economic value of AI. Agentic AI and Physical AI will drive a much higher economic value than LLMs and in turn create a much bigger market for AI infrastructure. But don´t take my word for it, see what Grok thinks about it :)
📊 Performance:
Total (from 2020): +91.6%
Feb 2025: -4.6%
Feb 2025 S&P500: -1.5%
💼 Portfolio overview:
💰 Sells:
What: Salesforce
How much: 100% of the position
Performance: +98% profit
Why: At ~8x EV/Sales and ~50x P/E Salesforce is, in my eyes, overvalued. Those are metrics I would expect for a high-growth innovator with loads of opportunities ahead which is not the case for this company. To put it in perspective NVIDIA trades now at ~42 P/E and Google at ~21 P/E. I am not convinced of Salesforce AI strategy and its core market (large enterprise) is already very highly penetrated. Salesforce still has a strong moat and it will be fine but I see no reason for such a premium valuation.
What: Biontech
How much: 100% of the position
Performance: -27% loss
Why: I needed cash for new investments, and through my investment in Moderna, I will retain optionality on the mRNA technology. I would not have sold if I had not needed the cash for new investments.
What: Apple
How much: 20% of the position
Performance: +101% profit
Why: Slightly trimming the position to deploy somewhere else.
💸 Buys:
What: Nebius
New/increase: new position
Why: I think Nebius has a shot at becoming the first $100bn AI company in Europe. In the last 12 months, it grew revenues by 462% from $20m to $117m and for the next 12 months, Nebius projects to grow ~500-600%. There is a ton of volatility on this company as it went up 10% the day after I started the position and then it crashed to -26%. Next week, I will publish a deep dive into this stock.
🧙♂️ A quote from a great investor
The quote: "The biggest risk of all is not taking one." — Larry Hite
What can you learn from it?
Risk is necessary for growth: Avoiding all risks can mean missing out on valuable opportunities.
Calculated risks are key: Smart investing is about managing risk, not avoiding it entirely.
Fear can be costly: Over-caution can lead to stagnation, while informed decision-making helps you take advantage of opportunities.
And that's it! Please let me know if you liked it, what I can improve, and if you think this newsletter could help a friend, please send it to them!
Federico
Please remember that everything written in this newsletter/website is for educational purposes only and should not be interpreted as financial, legal, or tax advice. The opinions, analyses, information, or recommendations expressed here are solely my own. Remember that financial decisions involve risks and should be made based on your own personal circumstances and after consulting a qualified professional.