Mutoro Group Partners, LP
“I met the snooker player Steve Davis once. His nickname was Steve ‘Interesting’ Davis because it was perceived that he was the most boring person on earth. I said to him, ‘How do you feel about that?’ He said, ‘I didn’t mind at all—because when I turned up and was even vaguely interesting, people were pleasantly surprised.’ He said, ‘It really worked out for me; I didn’t have to do much.’” — Ian Stone, Handbrake Off: The Athletic FC’s Arsenal Show, August 2025
|
Annual % Change |
Compound % Change |
||||
|
MGP, LP (Gross) |
MGP, LP (Net) |
HFRI Fund Index |
MGP, LP (Gross) |
MGP, LP (Net) |
|
|
2015 |
(3.5%) |
(5.0%) |
(1.1%) |
(3.5%) |
(5.0%) |
|
2016 |
24.5% |
18.9% |
5.4% |
9.6% |
6.3% |
|
2017 |
(3.3%) |
(4.7%) |
8.6% |
5.1% |
2.5% |
|
2018 |
(0.9%) |
(2.4%) |
(4.7%) |
3.6% |
1.2% |
|
2019 |
30.0% |
23.9% |
10.4% |
8.4% |
5.4% |
|
2020 |
34.2% |
25.7% |
11.8% |
12.3% |
8.6% |
|
2021 |
8.5% |
5.5% |
10.2% |
11.8% |
8.1% |
|
2022 |
(44.8%) |
(45.7%) |
(4.3%) |
2.3% |
(0.8%) |
|
2023 |
21.6% |
19.9% |
8.1% |
4.3% |
1.3% |
|
2024 |
23.8% |
22.0% |
10.4% |
6.1% |
3.2% |
|
H1 2025 |
0.3% |
(0.4%) |
3.9% |
5.8% |
3.0% |
|
Aggregate |
81.6% |
36.4% |
74.2% |
||
|
Annualized |
5.8% |
3.0% |
5.4% |
||
Dear Partner,
For the first half of 2025 our fund increased 0.3 percent gross but declined 0.4 percent net of fees. We added two new investments in the second quarter and ended the period with stakes in 14 companies—one immaterial—leaving 13 core holdings in our concentrated portfolio.
In investing, as in sport, there is often value in letting low expectations work in your favor. For much of the first half, we moved to elevated cash balances and waited, knowing that patience in expensive markets can be the wise choice. When prices fell and opportunities arose, we acted, initiating two investments in the portfolio after years of closely studying these businesses.
Both companies became attractively priced following periods of investor pessimism. In each case, we believe the market is overweighting short-term headwinds and underweighting durable competitive strengths, balance sheet resilience, and the ability to generate attractive returns over a full cycle.
The first operates in the U.S. housing market, focusing on higher-end buyers in supply-constrained, high-demand markets. Its customer base tends to be less rate-sensitive than the broader market, and it benefits from a persistent undersupply of new homes nationally. With a measured approach to land acquisition, meaningful design and customization revenue, and a strong financial position, we believe it can continue earning attractive margins through varied market conditions.
The second is a global consumer brand in athletic footwear and apparel, currently in the early stages of a strategic refocus after several years of uneven execution. It is streamlining product lines, emphasizing performance categories, and restoring relationships with key distribution partners. Near-term pressures from tariffs, inventory clearance, and competition are real, but we believe its brand equity, global reach, and financial resources provide both downside protection and the capacity to regain share and profitability over time.
We funded these new positions partly through trimming and exiting other holdings. One such sale was a long-standing position in a leading U.S. bank first purchased in March 2020 during the peak of the COVID-19 market panic. At the time, we were attracted to its strong capitalization, prudent risk management, revenue diversity, and dominant scale advantages—qualities that allowed it to emerge from prior crises stronger than peers. After five years, the position had more than doubled from our average cost, narrowing the gap between price and our estimate of intrinsic value. With fewer catalysts ahead and more compelling opportunities elsewhere, we redeployed capital into investments with greater expected return potential.
The table below shows the composition of our portfolio at the end of the quarter.
Portfolio Holdings
Thank you for your continued partnership and confidence. I look forward to discussing our positioning and outlook in more detail in future letters. In the meantime, I welcome your thoughts and questions, and remain available to speak with you or anyone you know who might be interested in joining us.
Sincerely,
Godfrey M. Bakuli
Founder & Managing Partner