SK Square update: started trimming exposure

We are now at ~2x MOIC on our SK Square purchases in March. After another strong day of outperformance, the NAV discount has compressed by a further 300bps to 39.5%. This is now 1,000bps tighter vs. when I originally shared my thesis on the name earlier this year.

Have shared in detail my thought process on the NAV discount with subs, including when I would start getting neutral on SK Square as being the preferred vehicle to express my bullish view on SK Hynix. Whilst we are not quite there yet, I have started trimming my exposure here by 10-15% as the R/R vs. owning SK Hynix outright is diminishing. If the NAV discount compression accelerates further this week I will likely look to take my cost basis out and ride the rest, with a view to potentially rotate into SK Hynix on pullbacks with the freed up capital.

Those that have followed me for a while know that I am laser focused on when to sell (which is, from experience the HARDEST part of the equation). We were fortunate enough to be long energy & tankers going into the war and getting the rotation into memory when that sector simultaneously pulled back. While we still think memory has room to run, we are eyeing a number of other attractive homes for our capital which we will be disclosing over the coming weeks.