๐ผ Expanse Stocks: Behind-The-Scenes
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Welcome Explorer! Behind the Scenes ๐๏ธ
Whatโs Behind?
Free access to ๐๏ธ Quarterly Updates (Last Update: 1-Apr-2025)
๐ฐ Whatโs new? Find links to my latest articles and other news
โ Who is behind Expanse Stocks? Get to know me better
๐ง Portfolio Composition by Industry and Geography, plus Valuation Metrics.
๐ Performance Tracking: Money-weighted returns compared to key benchmarks
โ Valuation Metrics: Tools to monitor and assess portfolio quality
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โ Who is Expanse Stocks
Iโm Diego (Twitter/X: @dcurras1, LinkedIn: diegocurras) also known as @Nikotes in the Stocktwits communityโa scientist at heart, software solutions engineer by trade, and a long-time investor and swing trader by passion.
My love for science drives my analytical approach, and after eight years in the market, Iโm here to share what Iโve learned.
I believe in the power of ideas, collaboration, and continuous learning. I hope you find this blog useful and, if you do, feel free to subscribe and stick around.
๐ง Portfolio Composition & Strategy
I donโt believe in rigid distinctionsโlike growth vs. quality or passive vs. active investingโsince markets are far more nuanced. Instead, my approach blends these strategies, reflecting both my long-term goals and short-term instincts as a swing trader. After more than eight years of trial and adjustment, I finally feel my portfolio strikes the right balance.
Overall Portfolio Breakdown
Last Update: 1-Apr-2025
๐น Passive Investing (0%)
Iโve completely exited ETF positions. With index multiples appearing stretched and passive strategies becoming increasingly concentrated, I see more value in carefully selected individual stocks across global markets.
๐น Active Investing (100%)
High-Quality Growth Stocks (100%): Focused on durable, fundamentally strong companies for long-term growth.
High-Growth & Speculative Plays (0%): A blend of disruptors for long-term hold or higher-risk swing trades.
๐น Note: 5% of my portfolio is currently held as cash in a separate money market account, ready to deploy for new opportunities in 2025.
Why I Prefer an Active Investing Strategy
As both a long-term investor and occasional trader, I know how hard it is to outperform the market consistentlyโespecially in recent years, with US indexes like SPY and QQQ delivering double-digit returns and outperforming +90% of active managers. The reality is that outpacing the market year after year is tough.
But I also believe individual investors have an edge over professionals. We donโt need to justify our performance every quarter or compare returns to benchmarks in the same way institutions do. This freedom allows us to stay patient, focus on long-term gains, and ride our investments with minimum pressure.
For me, itโs not just about returnsโitโs also about staying engaged, learning from market trends, and having the freedom to explore high-quality, durable growth stocks and high-growth speculative plays that intrigue me.
Q1 2025: Portfolio Readjustments Summary
Crazy weeks in the markets since February endedโฆ Without diving into politics (which I prefer to discuss elsewhere), the uncertainty in the US has been feeding into global markets, and if thereโs one thing the market hates, itโs uncertainty.
Why? Because markets act as a voting machine, pricing in earnings growth, inflation, liquidity, stability, and predictability. The last two are nowhere to be found right now, making it hard to price in whatโs coming nextโhence the steep correction weโve seen. And if you ask me, I donโt see an end in sight until some sanity returns from certain people in power.
With that in mind, Iโve made a few but meaningful moves in my portfolio throughout the year:
๐น Consolidation into high-conviction names โ When uncertainty rises, I stick to what I trust the most. Itโs mentally soothing.
๐น More defensive positioning โ Shifting into higher-quality names with exceptional management and owner-operators, strong moats, solid fundamentals, or better risk-adjusted returns. This led me to exit several positionsโeither due to lower conviction or because they were more vulnerable to economic downturns and lacked fundamental strength.
๐น Further geographic rebalancing โ U.S. exposure is now below 40% (down from 55.4% since the start of the year) as I continue shifting toward select high-quality opportunities outside the U.S. This move is largely driven by uncertainty and years of U.S. outperformance/multiple expansion. While Iโm not planning further reductions, I remain open to more adjustments if needed.
Letโs take a closer look at the portfolio composition๐
Portfolio Composition by Industries & Geographies
Last Update: 1-Apr-2025
I try to limit the nยบ of long-term holdings to 25. Currently, I own 18 names down from 25 positions (inc. swing trades) at the end of Q4 2024.
For my long-term portfolio, diversification is non-negotiable.
Of course, Iโm well aware of the phenomenal outperformance of U.S. equities over the past decade, with the S&P 500 and Nasdaq leading the way. U.S. equities have benefited from a combination of factors: a pro-growth capitalist environment, the dominance of the dollar, investor-friendly policies, and technological leadership. Add to that, robust financial institutions and a proactive Federal Reserve, and it becomes clear why the U.S. market has outpaced much of the world (nod to China).
However, markets are inherently cyclical, and conditions may change. The chart below speaks for itself:
My portfolio weighting reflects the current reality of U.S. dominance, but markets have a habit of shifting when most people least expect it. As a long-term investor, I believe spreading investments across industries, sectors, and regions builds resilience. Diversification cushions against regional risks and taps into new growth opportunities, ensuring the portfolio remains durable through market shiftsโbecause staying power matters as much as returns.
๐ Portfolio Performance
Last Update: 31-Mar-2025
My original portfolio dates back to November 2017 but Iโm not the same investor and swing trader I was thenโmistakes were made, but important lessons were learned.
I only felt completely at ease with my long-term portfolio's composition, strategy, and risk tolerance at the end of 2022, so Iโll be sharing returns from January 2023 โalso coinciding with the consolidation of my entire long-term portfolio in one single broker (excluding occasional trades, if I play them I do it on a different broker).
Here is the Money-Weighted Return of the Expanse Stocks Portfolio since January 2023, compared to SPY and the Vanguard Total World Stock Index Fund:
While YTD or Monthly returns are commonly shared by many, they can be misleading for assessing long-term returns. I consider at least a 5-years horizon is more appropriate for evaluation. The compounding effect means that past performance significantly impacts our overall return, making longer-term perspectives more revealing.
I am quite satisfied with my portfolio returns so far, but it's definitely to early to evaluate long-term performance.
โ Valuation Metrics
Last Update: 1-Apr-2025
Here are key metrics of my current Portfolio I use to monitor and assess its quality:
Growth & Durability โ
Double digits forward EPS growth
Double digits top line and EPS CARG (3y-avg and 5y-avg)
Standout Margins & Operational Excellence โ
Operating margin close to 25% and EBITDA margin close to 30%
High FCF Margins >22% and Net Profit Margin close to 20%
Capital Efficiency โ
High Return on Invested Capital (ROIC) >15% and high ROCE > 20%, indicating an efficient use of invested funds to generate profitable returns
Although not shown in the statistics above, the portfolioโs FCF Conversion > 100%, showing high efficiency to turn profits into actual cash flow
Financial Sustainability
Fwd. FCF Yield - indicating ability to generate cash and sustain operations - at 3.3%. A bit low currently as some of my heavy-weighted companies are high quality companies and some going through a high Capex cycle ๐ก
Positive Forward P/E, EV/FCF and EV/OCF, although currently trending at a relatively high multiple ๐ก
Low Leverage โ
Net Debt/EBITDA < 1, reflecting ability to manage debt and a good financial health
Total Debt against Capitalization <40%, below the +50% ratio of the S&P 500 index constituents.
๐ NOTE: Some positions in my long-term portfolio are growth companies or have non-normalized earnings, which can distort valuation multiples.
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