Monthly Report: December 2025

Performance at a Glance

In December, Veloris Capital returned +1.50% while the S&P 500 lost -0.22% and the Nasdaq dropped -0.80%. This translates to an outperformance of +1.72% vs S&P 500 and +2.30% vs Nasdaq for the month.

The F1 Dashboard

In Formula 1, the best drivers know when to accelerate and when to brake. As we enter January, we're in acceleration mode with 83.5% equity exposure.

December saw markets struggle with a year-end pullback. While SPY lost -0.22% and QQQ dropped -0.80%, our portfolio delivered +1.50%—outperforming both benchmarks while managing risk through dynamic exposure.

Risk Overlay Readings

• Momentum: Bullish (+16.1% strength)
• Volatility Regime: LOW
• Stress Category: LOW
• Drawdown Protection: Active

Our Conservative model operated at 50.6% exposure for most of December, then increased to 83.5% by month-end as conditions improved. This disciplined approach—not being fully invested during uncertainty—is exactly how we manage risk while still capturing upside.

What Happened in Markets

December delivered the "Santa Claus Rally that wasn't." Markets ended the month with a four-session losing streak going into year-end, driven by tax-loss harvesting and thin holiday liquidity. The S&P 500 closed December 31st at 6,845.50, down 0.74% on the final day alone.

Despite the weak finish, 2025 was the third consecutive year of double-digit gains for US equities. However, leadership remained narrow—with AI and tech names driving most of the gains while many sectors lagged.

Our portfolio's outperformance came from strategic positioning in precious metals and technology names that bucked the broader market weakness.

Pillar 1: Stock Universe Update

Our quantitative screening—looking for stocks with the strongest financial ratios and confirmed momentum within their sectors—has qualified stocks across multiple sectors for January positioning.

Notable Shifts Entering January

• Precious metals & miners remain strong (gold/silver momentum continuing)
• Technology rotation toward AI infrastructure and networking
• Healthcare showing momentum (diagnostics in focus)
• Defense sector strength continuing into 2026
• Real estate services recovering

Pillar 2: Portfolio Changes

Our optimizer has selected 16 positions for January—a rotation from the 13 positions held in December. This represents a significant rebalance with 7 new additions and 4 exits.

New Positions (7)

• CIEN (Ciena Corporation) — Technology | Communication Equipment. Network technology leader benefiting from data center and AI infrastructure buildout. Market Cap: $33B, Revenue Growth: +20.3%
• RTX (Raytheon Technologies) — Industrials | Aerospace & Defense. Defense giant with continued contract momentum heading into 2026. Market Cap: $246B, Revenue Growth: +11.9%
• GM (General Motors) — Consumer Cyclical | Auto Manufacturers. Value play in autos with reasonable valuation and improving EPS trajectory. Market Cap: $77B, P/E: 15.5
• JLL (Jones Lang LaSalle) — Real Estate | Real Estate Services. Commercial real estate services leader riding the recovery. Market Cap: $16B, Revenue Growth: +10.9%
• GH (Guardant Health) — Healthcare | Diagnostics & Research. Precision oncology pioneer with exceptional growth. Market Cap: $13B, Revenue Growth: +38.5%
• EQX (Equinox Gold) — Basic Materials | Gold. Gold miner with explosive revenue growth. Market Cap: $11B, Revenue Growth: +91.2%
• PAAS (Pan American Silver) — Basic Materials | Gold/Silver. Major silver/gold producer providing precious metals diversification. Market Cap: $22B, Revenue Growth: +19.3%

Positions Closed (4)

• AU (AngloGold Ashanti) — Exited after strong run. Reallocating gold exposure to EQX with stronger growth metrics.
• NEM (Newmont Mining) — Exited. Largest gold miner but relative underperformance vs. mid-cap miners.
• BAC (Bank of America) — Exited financials. Rotating capital to higher-momentum opportunities.
• WDC (Western Digital) — Exited after exceptional 2025 performance. Taking profits on storage trade.

Positions Maintained (9)

• MU — Technology | Semiconductors. Memory demand + AI tailwinds
• LITE — Technology | Electronic Components. Optical networking strength
• COHR — Technology | Electronic Components. Continued momentum
• CLS — Technology | Electronic Components. Data center buildout
• KGC — Basic Materials | Gold. Precious metals exposure
• B — Basic Materials | Gold. Retained gold position
• CDE — Basic Materials | Silver. Silver momentum
• RY — Financial Services | Banks. Canadian banking stability
• W — Consumer Cyclical | E-commerce. Position maintained

Current portfolio: 16 positions across Technology (5), Basic Materials (5), Healthcare (1), Industrials (1), Real Estate (1), Consumer Cyclical (2), Financial Services (1)

Pillar 3: Risk Overlay in Action

December Protection & Positioning

Our risk overlay demonstrated its value this month. While markets sold off into year-end, our disciplined exposure management allowed us to outperform while taking less risk.

The Conservative model kept us at reduced exposure (50.6%) during the uncertain early-December period, then increased to 83.5% as year-end conditions stabilized. This is exactly how the system is designed to work—cautious when signals warrant, more aggressive when they improve.

“A buy-and-hold investor was fully exposed to December's -0.22% (SPY) decline. We captured +1.50% by being strategically positioned—not through prediction, but through systematic signal response.”

Skin in the Game

We don't just run this strategy—we live it.

• Ronny: Six-figure capital invested, adding monthly
• Quant Partner: Six-figure capital invested, trades the same approach

Combined, we have significant personal wealth on the line. When you win, we win. When we protect capital, we all benefit. This is not a strategy we're selling—it's a strategy we're betting our own money on.

Looking Ahead

Our indicators currently suggest continued bullish positioning for early 2026.

The Three Pillars Remain Active

• Stock Universe: Qualified stocks across technology, materials, healthcare, industrials
• Portfolio: 16 positions, optimized for risk-adjusted returns
• Risk Overlay: 83.5% equity exposure

Key Themes for January

• AI infrastructure buildout (CIEN, CLS, COHR, LITE, MU)
• Precious metals strength (KGC, B, CDE, EQX, PAAS)
• Defense spending (RTX)
• Healthcare innovation (GH)

We continue to pursue the goal: Outperform SPY with downside protection.

Why Copy Veloris Capital?

• Two veterans with 40+ years combined experience
• Both partners with six-figure capital invested
• Institutional trading meets quantitative engineering
• Three-pillar systematic process refined over countless hours
• Risk overlay tested through every major crisis since 2008
• Goal: Beat SPY with downside protection
• Full transparency—you always know the "why"
• We don't just run this strategy—we trade it ourselves

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