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March was a very turbulent month in the markets, with the weight of the war pushing bond yields up and markets sharply downward. We also saw some very clear movements at both the factor and sub-sector levels, likely also influenced by the decline in hedge funds.
In the fund, we used some of this upheaval to increase positions in stocks where we see strong fundamentals and attractive risk/reward, while being mindful that Iran creates a much broader range of outcomes – particularly more downside – for the macroeconomic environment. In terms of stock and technology-specific news feeds, we saw strong performance from Broadcom and Micron (both held in the portfolio) – both significant winners from the ongoing rollout of AI infrastructure. Elsewhere, we had good data points related to AI demand and token generation, and we believe agent-based AI has driven a significant increase here. On the CPU side, we continued to see reports of price increases, with we believe a large portion of the increase in demand is driven by AI agents.
As we’ve noted before, agents use significantly more CPU compute than humans (both because they perform tasks faster and are constantly working). This particularly benefits AMD in the portfolio. In early March, we received new run rate numbers from both Anthropic and OpenAI. First, Bloomberg reported that Anthropic is now at a run rate of $19 billion in revenue. That’s a pretty staggering number and a pretty staggering increase (and again, it shows the rapid growth of agents). They reported $14 billion in mid-February, so $5 billion in a matter of weeks – especially considering how early we are in the adoption of Claude Code among knowledge workers. OpenAI is also reportedly at $25 billion in annual revenue (up from ~$20 billion reported in late 2025). Much like Anthropic, we believe much of this has been driven by enterprise usage – including Codex. At the end of the month, OpenAI completed its $122 billion funding round (we believe it’s the largest private funding round in history), valuing the company at $852 billion ahead of a potential IPO by the end of the year. Of particular interest were the operational metrics released alongside the announcement – particularly around token demand – their API is now processing over 15 billion tokens per minute (up from 6 billion in October – so a 2.5x increase in 6 months); Codex (their specific coding agent) users have increased 5x in the last 3 months and usage is growing at 70% month-over-month.
More generally, the accelerating token consumption reflects the trends we see across the industry. On the short side, we continued to see negative data points for the smartphone and automotive cycles, and we continue to find short-selling opportunities in companies exposed to these end markets.
The fund rose by 0.6% in March and is up by 1.5% so far this year.