2021 Annual Letter
Now that 2021 has ended, and while self-isolating after testing positive for COVID, I thought I might as well write the first letter to subscribers. My brother spread the virus to the whole family and although all our symptoms are mild, we had to spend New Year’s Eve separately. I never thought I would end up saying goodbye to the year like this, but luckily for me, I did it together with my wife, feeling grateful for 2021 – a year I feel satisfied with, both in the personal and professional side.
My portfolio (which is updated every quarter for paying subscribers) has ended the year with a +47.4% return, after a +41.8% return in 2020 and a +30.2% return in 2019, back when I started managing capital for my family and some friends. The 5 best-performing stocks of the year were Leatt +339% (analysis link), Kistos PLC +168%, RCI Hospitality +110% (analysis link), Sdiptech +107% and KKR +88%.
Although most investments have been successful, I try to keep in mind the fact that confidence, complacency, and a lack of self-criticism and humility are an investor's worst enemies. The keys to this journey have been luck and staying excited enough to continue learning every day. I honestly think if I looked back and didn’t feel embarrassed of how I perceived investing at that time, then it would mean I am not moving at the pace I should. I have never been a person to stand out from the rest, nor have I been smart enough to learn from the mistakes of others. I am one to think the most important lessons have to be experienced and cannot be taught. Acknowledging my capabilities and my limits as an investor has helped me survive in what is the most competitive, yet fair and rewarding game in the world. Knowing how to manage the scale of mistakes so that none of them can put you out of the game is an advantage that I think is generally underestimated. Survival is essential in long-lasting games like investing, because compound interest applies not only to capital but also to knowledge.
The launch of my blog this year has helped me accelerate my learning curve. No matter how many hours you spend reading about a company, you will only come to fully understand it when you need to explain it to others. I am very grateful for my subscribers to join me in this project as I continue to develop as an investor. The negative aspect of writing a blog is the amount of time involved – time that sometimes I don't have, and makes it difficult to combine this little hobby with my personal life. At the end of the day, we all have the same 24 hours to spend, and I still have a long way to go before being able to write full time. As of now, I must trade a few hours of sleep to continue this personal adventure, but I’m hopeful that in the near future I will be able to do this as my main gig.
I also want to use this opportunity to thank all the people who help me share the blog and make it more visible. I am confident that word of mouth is the most effective advertising tool for such a project. Thank you for your selfless help.
I don’t want to say goodbye without saying a few words to my friend Javier Acción, who has shared so much with me this year and from whom I have learned a lot. We both know the future will hold only good things for him. On the other hand, with only a month to go until my 28th birthday, here are two things I’ve noticed: 1) Although I have had a good time, I have spent too much time on Twitter and I plan to reduce my engagement on the platform from 2022 onwards, focusing more on my blog and enjoying more time with family, friends and sports, if possible. 2) Twitter is a place full of endless possibilities to connect with people from all over the world. I think many people do not realize this and waste the potential of the platform making noise or criticizing the work of others as a hobby. Thanks to Twitter, this year I have met my Australian friend Stu, who I have a special affection for because of his kindness and for being one of the first paying subscribers to my Substack. Thanks for your support from the beginning, Stu. I also had the pleasure of meeting Anthony Deden thanks to one of his shareholders. Anthony is a reference as an investor, and I will always be grateful to him for sharing his infinite wisdom with a random guy from another geography. Twitter is special because you can connect, but also learn from a distance from people who do excellent work in their day-to-day lives. David Kim from Scuttleblurb, Alex Morris from TSOH Investment Research, Abdullah Al-Rezwan from MBI, Liberty from libertyrpf or YHamilton from YHamiltonblog are some of my references, not only for the quality of their work, but for their commitment, showing up no matter what. The recurrence of their posts is fascinating. The proliferation of Substacks this year has been something inevitable in my understanding because barriers to entry are minimal, and opportunity cost is great, but I think only those who can commit and continue writing for years will end up succeeding. I hope I can keep sharing my adventures with Finding Moats subscribers and that this letter is the first of many.
I hope 2022 will bring even better things than 2021 for all of us. Thank you for your time, and thank you to those who support my little blog.
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