Perseverance

#### I. Institutional Overview The Q4 2025 13F filing for **Perseverance** reveals a sophisticated, high-conviction investment vehicle that operates with a distinct "quality-over-quantity" philosophy. Managing a reported portfolio value of approximately **$680.49 million**, the institution maintains an exceptionally lean profile with only **12 holdings**. This level of concentration—where the top two positions alone account for over 68% of the total assets—places Perseverance in the upper echelon of concentrated "smart money" managers. Such a strategy suggests that the firm does not seek to track the broader market indices but rather aims to generate significant alpha through deep-dive fundamental research and aggressive positioning in a handful of high-probability outcomes. Analyzing the scale and trajectory of Perseverance, we observe a manager that is comfortable with significant capital commitment despite a relatively modest AUM compared to global giants. The portfolio value of $680.49 million, when spread across just 12 names, results in an average position size of roughly $56.7 million. However, the reality is even more skewed: the largest position, **HTHT (H World Group Limited)**, stands at $243.36 million, while the smallest, **API (Agora, Inc.)**, is just $2.85 million. This "barbell" approach within a concentrated framework indicates a clear hierarchy of conviction. The firm appears to utilize its top holdings as "ballast stones"—long-term, structural bets on industry leaders—while using smaller positions as "scouting parties" or tactical entries into emerging themes. The psychological portrait of Perseverance is one of **patience and extreme selectivity**. By holding only 12 stocks, the investment team signals that they have a very high hurdle rate for new entries. Every stock in the portfolio must earn its place against a backdrop of intense internal competition for capital. This is not a "closet indexer" or a firm that worries about tracking error. Instead, it is a manager that embraces idiosyncratic risk, betting that its superior understanding of specific business models—particularly in the consumer and platform technology sectors—will outweigh the risks associated with a lack of diversification. Furthermore, the stability of the core holdings suggests a "low-turnover" mindset, although the Q4 activity shows they are not afraid to make bold adjustments when the price is right. The massive 47.17% increase in **PDD (PDD Holdings Inc.)** and the 75.11% boost to **BEKE (KE Holdings Inc.)** this quarter demonstrate a "double down" mentality on existing winners or perceived valuation dislocations. Conversely, the total exit from **AS (Amer Sports, Inc.)** and **GOOS (Canada Goose Holdings Inc.)** indicates a decisive shift away from certain sub-sectors of the consumer market. Perseverance is not merely holding; it is actively sculpting a very specific vision of the future economy, one dominated by high-efficiency platforms and dominant service providers. In summary, Perseverance represents the quintessential "conviction manager." Its current state is characterized by a heavy concentration in consumer-facing platforms, a willingness to maintain massive individual position weights (exceeding 30% for single stocks), and a strategic focus on companies that exhibit strong operational leverage. The institution’s psychological profile is defined by a "concentrated offensive" posture, where risk is managed not through diversification, but through an intimate, granular understanding of a few select businesses. #### II. Sector Allocation Analysis The sector allocation of Perseverance in Q4 2025 provides a transparent window into the firm’s macro-economic outlook and its specific "track selection" logic. The portfolio is overwhelmingly dominated by a single sector, reflecting a specialized expertise and a bold bet on a specific segment of the global economy. | Sector | Weight (%) | Trend | | :--- | :--- | :--- | | Consumer Discretionary | 74.03 | High Concentration | | Communication Services | 18.87 | Secondary Pillar | | Real Estate | 2.70 | Tactical Exposure | | Consumer Staples | 2.69 | Defensive/Niche | | Technology | 1.71 | Growth/Foundational | | Healthcare | 0.00 | Complete Absence | **2.1 Concentration Analysis: The Power of the "Big Three" Sectors** The most striking feature of Perseverance’s allocation is the extreme concentration in the top three sectors. The sum of **Consumer Discretionary (74.03%)**, **Communication Services (18.87%)**, and **Real Estate (2.70%)** accounts for a staggering **95.6%** of the total portfolio. This level of focus is rare even among hedge funds and indicates a "thematic" investment style. Perseverance is essentially a consumer-and-platform specialist. By allocating nearly three-quarters of its capital to Consumer Discretionary, the firm is making a leveraged bet on the resilience and evolution of the consumer. However, a closer look at the underlying stocks (HTHT, PDD, YUMC) reveals that this is not a bet on "luxury" or "excess," but rather on **efficiency, scale, and essential services** within the discretionary space. **2.2 Sector Rotation and Macro Signals** The shift in sector weights this quarter reveals a "slimming down" of the consumer portfolio to focus on higher-efficiency plays. The exit from **Amer Sports (AS)** and **Canada Goose (GOOS)**—both categorized under Consumer Discretionary—suggests a rotation away from "brand-heavy" or "inventory-heavy" retail. Instead, the capital appears to have been recycled into **PDD Holdings**, which represents a "platform-lite" model of e-commerce. This rotation signals a preference for companies with superior capital efficiency and the ability to thrive in a potentially volatile inflationary or deflationary environment. The **Communication Services** allocation (18.87%) acts as a technological backbone for the portfolio. With **Alphabet (GOOG)** and **NetEase (NTES)** as key components, this sector provides a mix of global advertising dominance and digital entertainment. The stability of this sector weight suggests that Perseverance views these as "utility-like" growth assets—companies that provide essential digital infrastructure and have the pricing power to withstand macro headwinds. **2.3 Industry Trend Insights: From "Hard Goods" to "Service Platforms"** A deep dive into the industry logic reveals a clear trend: Perseverance is moving away from "Hard Tech" and "Physical Retail" toward **"Service Platforms."** The massive weight in **HTHT (H World Group)**, a leader in the multi-brand hotel industry, combined with the increase in **BEKE (KE Holdings)**, a leading integrated online and offline platform for housing transactions, shows a thematic focus on **digitally-enabled service ecosystems**. These companies don't just sell a product; they manage a marketplace or a massive service network. This reflects a belief that in a mature economy, the highest margins and most durable moats are found in those who control the "transactional layer" of essential consumer activities like travel and housing. **2.4 Macroeconomic Judgment: The "Efficiency" Bet** Based on this allocation, we can infer that Perseverance is skeptical of a broad-based, high-growth economic "rising tide." Instead, they are positioning for a "K-shaped" or "Efficiency-Driven" recovery. By betting heavily on **PDD**, they are wagering on the "value-for-money" trend, where consumers become more price-sensitive and migrate to platforms that offer the best deals. By holding **HTHT**, they are betting on the consolidation of the hospitality industry, where scale players take share from fragmented independents. The complete absence of **Healthcare** and the minimal exposure to **Technology (1.71%)** (represented primarily by the TSM addition) suggests that Perseverance is avoiding sectors with high R&D risk or extreme valuation volatility. They prefer "proven" business models with high cash flow visibility. The small **Technology** position in **TSM** is likely a tactical recognition of the semiconductor's role as the "new oil," but it remains a peripheral part of their consumer-centric core. **2.5 Conclusion of Sector Analysis** Perseverance’s sector layout is a masterclass in "conviction-led thematic investing." They have ignored the traditional advice of diversification to double down on a specific vision: a world where dominant digital and service platforms capture the lion's share of consumer spending. Their macro judgment is one of **cautious optimism focused on efficiency leaders**, avoiding the "noise" of broader market sectors to maintain a laser focus on where they believe the most durable alpha resides. #### III. Top 10 Holdings Deep Dive The top 10 holdings of Perseverance represent the "engine ro ---