Letmo

Framework

Investment Framework

A concise overview of Letmo's investment framework.

Investing is easy. Outperformance is hard.

Making money from investing is easy. Put money into a low-cost index ETF, hold it over a long period of time, and you will earn a decent market return with a manageable level of risk.

The harder problem is generating excess return above that baseline over time, repeatedly, and without relying on uncontrolled risk. Letmo attempts to do that by exploring opportunities on both the long and short side.

How to outperform.

Letmo believes consistent outperformance requires a sequence of conditions:

  1. The investor must be able to develop an independent view grounded in business understanding, data, and practical judgment.
  2. That view must differ from the market's current consensus.
  3. The independent view must prove more accurate than the market's consensus.
  4. Within a reasonable time frame, the market must recognize the gap and adjust toward reality.

Each step is difficult. Each step can fail. These conditions are necessary, but not sufficient. Even when they are present, the final result still depends on position sizing, time horizon, and the cost of expressing the idea.

Long-side research.

On the long side, Letmo looks for businesses whose long-term economics may be stronger than the market appreciates.

The research starts with fundamentals: the company's business model, competitive position, operating quality, management, growth history, and future growth projections. Letmo tries to understand not only whether a company is good, but whether the market is underestimating the durability or value of that business.

Valuation matters. Expected return is assessed through growth assumptions, exit multiples, and a range of possible outcomes. The process also considers confidence level, downside risk, accounting quality, fraud risk, and what could happen if the thesis is wrong.

Short-side research.

On the short side, Letmo looks for situations where market expectations, valuation, or business reality appear materially misaligned.

Short candidates generally fall into two groups. The first group includes real businesses with viable models, but with expectations or valuations that have become difficult to justify. The second group includes structurally weak, promotional, or story-driven businesses where the narrative is doing far more work than the economics. These are companies where investor excitement may be built more on slogans, technical buzzwords, paid promotion, or hope than on durable business reality.

Short-side research focuses on business model viability, technical claims, founder and management background, paid promotion, fundamentals, cash balance, cash burn, dilution speed, and the consequences if the thesis is wrong. Letmo also studies the investor base behind the other side of the trade. The level of naivety, overconfidence, and poor reasoning among bullish communities can be an important signal revealing how far the market narrative has drifted from reality.