Our portfolio performance for May 2025 has delivered a year-to-date return of 18.9%, a figure that towers over the S&P 500’s anaemic 0.5% gain for the same period. Since January 2022, we’ve clocked a total return of 79.5%, handily outpacing both a custom benchmark (23.0%) and the S&P 500 (29.6%). This update isn’t just a pat on the back; it’s a window into a strategy that’s heavily tilted towards a blend of US and Chinese equities, with calculated bets on high-growth and value opportunities. With a portfolio allocation of 63% to the US, 32% to China, and smaller stakes in Canada and Switzerland, we’re navigating a complex global landscape. Let’s unpack the positions driving these numbers, the transactions shaping our approach, and the broader implications for investors eyeing similar exposure.
Portfolio Composition: A Transcontinental Play
Our holdings span a diverse mix of sectors and geographies, with key positions in names like PDD, TMDX, BABA, HOOD, UNH, META, PYPL, REGN, MRNA, BTG, EW, and AMD. This isn’t a scattergun approach but a deliberate balancing act between high-beta tech and healthcare innovators in the US, alongside undervalued growth stories in China. Recent moves reflect this conviction: we’ve initiated new positions in UNH and REGN for their defensive growth profiles, while increasing stakes in PDD and BABA to capitalise on a potential rebound in Chinese consumer sentiment. The absence of sold positions this month signals confidence in our current lineup, even as global macro headwinds loom.
What’s telling is the heavy allocation to China at 32%. Despite regulatory overhangs and geopolitical noise, we see asymmetric upside in names like BABA, which, according to data from Yahoo Finance, trades at a forward P/E ratio significantly below its historical average. This suggests a margin of safety for patient capital, provided one can stomach the volatility. Meanwhile, US-heavy exposure through META and AMD taps into secular AI and semiconductor tailwinds, though at elevated valuations that warrant close monitoring.
Performance Drivers: Where the Gains Are Coming From
Our outperformance isn’t mere luck; it’s the result of tactical positioning in high-growth pockets while maintaining ballast through defensive names. Take PDD, a Chinese e-commerce disruptor that’s benefitted from domestic consumption trends even as global investors remain skittish. On the US side, META’s relentless pivot into AI-driven advertising and AMD’s chip dominance have likely contributed outsized returns, though both face risks from a potential slowdown in capex cycles if economic data softens.
Less discussed is the second-order effect of our healthcare bets like UNH and REGN. As ageing demographics and biotech innovation collide, these names offer a hedge against tech volatility while still participating in upside via drug pipelines and managed care efficiencies. Posts circulating on social platforms suggest growing retail interest in UNH as a ‘deep value’ play, aligning with our view that mean-reversion could drive outperformance in a risk-off environment.
Yet, the elephant in the room is China’s weight in the portfolio. A 32% allocation is a bold statement when many institutional players have slashed exposure citing policy unpredictability. If Beijing rolls out meaningful stimulus, as some macro thinkers speculate, our positioning could capture significant alpha. Conversely, a protracted slowdown or escalated trade tensions could test our resolve. It’s a high-stakes wager, but one we believe tilts towards reward over risk.
Market Context: Navigating a Bifurcated Landscape
Zooming out, the broader market in 2025 remains a tale of two worlds. The S&P 500’s paltry 0.5% YTD return reflects a tug-of-war between sticky inflation, hawkish central bank rhetoric, and patchy corporate earnings. Meanwhile, our portfolio’s 18.9% gain underscores the value of active management over passive indexing in such choppy waters. Drawing on historical parallels, this environment echoes the early 2000s, where sector rotation and selective stockpicking separated winners from the herd.
Looking at industry trends, the Nasdaq-heavy tilt in our benchmark (60% weighting) suggests tech remains a key battleground. Yet, unlike the dot-com era, today’s tech leaders like META and AMD are cash-flow machines, not speculative pipe dreams. Still, as some respected macro voices have noted, a rotation into cyclicals or value could catch growth investors flat-footed if rate hikes persist. Our increased exposure to PDD and BABA might also face headwinds if US-China relations sour further, a risk we’re mitigating through diversified healthcare and consumer plays.
Forward Guidance and a Speculative Thought
For investors with a similar risk appetite, the takeaway is clear: selective overweight in Chinese equities offers a compelling risk-reward profile, but only if paired with robust US anchors like healthcare and tech. We’d advocate trimming exposure to frothy US growth names if Q3 earnings disappoint, while doubling down on undervalued China plays should stimulus rumours solidify. Tactically, options strategies around names like UNH could derisk entries, a sentiment echoed in broader online trading discussions.
As a parting shot, here’s a bold hypothesis: if China’s politburo surprises with a consumer-focused stimulus package by year-end, our 32% allocation could propel portfolio returns past 30% YTD, making us the outlier in a market still obsessed with US-centric growth. It’s a long shot, but one worth watching as the geopolitical chessboard shifts. After all, in investing, fortune often favours the contrarian with a sense of humour and a steady hand.