Whitney Tilson's Releases First Annual Letter Of His New Fund; Discloses -1.7% 2012 Drop
Wondering why AAPL is finally soaring after stagnating for days? Because the market finally knows that Whitney Tilson sold his handful shares of AAPL. We learn all this and much more in today's humorous interlude - the first annual letter out of Kase Capital. What is Kase Capital? "Now that I’m managing money solo, I’ve adopted the name “Kase”, so our fund is now doing business as the Kase Fund. The letters of “Kase” come from the four most important people in my life: my wife, Susan, and three daughters, Alison, Emily, and Katharine. May they bring all of us as much good fortune as they’ve brought me!" And yes, the always "imaginative" 13F-ghoster took that particular idea from Barry Rosenstein's Jana Partners.
The full letter is presented below, but the first two paragraphs are worth the price of admission alone:
After 11½ strong years, the fund has lagged badly over the last 2½ years. To turn things around, I’ve made many changes (discussed below), most importantly returning to my roots of managing money solo.
In June, Glenn and I decided to each run our own funds, and began doing so on July 1st. As part of this process, I took our fund to cash so that I could rebuild the portfolio from scratch. However, I wasn’t able to exit a handful of illiquid positions, most notably the Iridium warrants, which impacted performance in the second half of the year, but today I’m pleased to say that the portfolio is where I want it, conservatively positioned in my very best ideas. My mind is clear and focused on the long term, and I’m looking forward with confidence and optimism.
And the conclusion:
After a strong 12-year run, 2011 and 2012 were lost years. I feel very badly about this and apologize to you. But I know you don’t want an apology – you want performance! To that end, I’ve reflected on the mistakes I’ve made, learned from them, and taken significant steps to maximize our chances of success going forward: I’m now the sole portfolio manager and have dramatically simplified, focused, and de-risked the fund. I’m confident that my strategy is sound, I will execute it well going forward, and we will all profit.
I’m heartened and humbled that the vast majority of the fund’s partners have chosen to maintain their investment. I’m determined to reward your vote of confidence and want to thank you for your patience, confidence and support.
It is unclear just which extended family members he is referring to. And no, there is no mention of Tilson's recently favorite Herbalife short anywhere.