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The power of portfolio management.

One of the biggest themes in my portfolio over the past few weeks has been sector rotation.
Many of the stocks that have driven my performance over the last year continue to execute at an incredibly high level. Names like $NBIS , $RKLB , $ASTS , $AMD , and $MU have all experienced significant upside as investors continue piling into AI infrastructure, semiconductors, and space.
The challenge as an investor isn't finding great companies. It's deciding what to do after you've already made money.

When you're sitting on positions that are already up 5x, 10x, or more, it's easy to become emotionally attached to the names. You build conviction, the thesis keeps working, and eventually it's tempting to convince yourself you'll never sell a share because you found the perfect stock. The reality is that successful portfolio management isn't about abandoning your winners. It's often about making small adjustments around the edges while keeping your largest holdings intact.

The long-term thesis for these companies remains completely unchanged. I'm still incredibly bullish on the names that have driven portfolio performance. However, when a stock has gone up hundreds of percent in a relatively short period of time, valuations become extended, price action becomes extended, and investor sentiment can start approaching euphoria. At that point, trimming a small portion of a position can create meaningful capital to deploy elsewhere. That's exactly what I've been doing.

Over the past few weeks, I've been steadily rotating some profits into software. For months, investors have been extremely pessimistic on the software sector. The narrative centered around AI disruption, slowing growth, margin pressure, and the idea that software businesses were somehow becoming obsolete. Yet when earnings season arrived, the actual results told a completely different story. Many software businesses continue to produce exceptional results. Revenue growth remains strong and, in many cases, is actually reaccelerating. Margins remain healthy. Cash flow remains robust. Customer retention remains high. Share repurchase programs remain active. The fundamentals simply never matched the fear.

What caught my attention was the disconnect between those fundamentals and valuation.
$ZETA was one of the clearest examples. The company just grew revenue by 50%, yet was trading at roughly 2.5x sales. $NOW was another name where the market appeared to be offering a category leading software platform growing around 20% annually at a historical low P/E. I also added exposure through $IGV to gain broader participation across the software sector.

To me, these weren't speculative bets whatsoever. The risk/reward was simply too attractive to ignore. When you're able to buy companies with accelerating growth, strong margins, durable competitive advantages, and depressed valuations because investors have become overly pessimistic, those are often some of the easiest opportunities in the market. We're already beginning to see some of that thesis play out as capital starts rotating back into software.

I also made one smaller addition outside of software with $CRWV . While software was the primary area I wanted to add exposure to, CoreWeave stood out as another attractive opportunity. The company is growing revenue at well over 100%, serves some of the largest AI customers in the world including OpenAI, Microsoft, Meta, and Anthropic, and has accumulated a backlog approaching $100 billion. It's still an early position for me, but given the scale of demand for AI infrastructure, I felt the potential upside justified starting a position. If management executes successfully over the next several years, the revenue opportunity ahead of them is enormous.

The broader lesson here isn't about software or CoreWeave specifically. It's about market cycles. The market is constantly repricing opportunities. Capital rotates, narratives change, and leadership changes. The stocks that led six months ago won't necessarily be the stocks that lead over the next six months.

One of the biggest advantages individual investors have is the ability to stay flexible. If you own a stock that's gone up 200%, 300%, or 500%, you don't need to sell the entire position. In fact, the biggest returns I've ever generated have come from simply holding exceptional businesses for long periods of time. However, taking a small amount off the table after a massive move can often fund an entirely new opportunity elsewhere in your portfolio.

That's exactly what I did here. I wasn't selling Rocket Lab, AST SpaceMobile, Nebius, AMD, or other high-conviction positions because the thesis changed. I was simply taking a small amount of capital from stocks that had already delivered tremendous returns and redeploying it into stocks that I believed offered a more attractive forward looking risk/reward profile.

That's how I've always approached portfolio management. Not by trying to perfectly time tops. Not by constantly trading in and out of positions. But by continuously analyzing risk versus reward and asking myself where the next dollar should go.

Over the past few weeks, that answer was software. The fundamentals were improving, valuations were attractive, and sentiment was terrible. Those are often the exact conditions where some of the best opportunities are found, and so far the market has started to recognize the same disconnect that originally attracted me to the sector.

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