CVS - Vltava Fund Q2 2024 Letter To Shareholders

2024-07-03 09:10:00 ET

Summary

• Vltava Fund SICAV, Plc is a global equity investment fund launched in 2004. The Fund is dedicated to qualified investors.
• The variants for portfolio composition are indeed boundless.
• So, how do we determine the size of individual positions in Vltava Fund?

Size Matters

When we get together with you from time to time in various meetings and go through our portfolio, we often get asked how we determine the size of each position. I want to address this topic in today's letter to shareholders. It is one thing to select individual titles, but it is another to determine how much weight each of those individually receives in the portfolio. This is a matter that is rather rarely discussed in general, but it is very important. It is also very subjective. Weights matter because they have a big impact on the portfolio's overall return. Each stock in the portfolio contributes to its total return by a number that is the product of the stock's return and its share in the size of the overall portfolio. While the main focus tends to be on the return of individual stocks, this second factor in the equation is no less important. You can have the very best investment, but if its representation in the portfolio is minimal, then its impact on the overall portfolio return also will be quite limited. The reverse is of course also true. If you have a high-loss investment in your portfolio, its impact on total return will be all the greater the more space it occupies in that portfolio....

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