Eduardo Marques’ Pertento hedge fund, which he launched in London after leaving Chris Hansen’s Valiant Capital Partners in 2021, has been on something of a roll. Defying the stock market’s downturn, the fund gained more than 5 percent in the first quarter, on the back of three years of double-digit gains.
“Our fund held ground during another quarter marked by plot twists,” Marques wrote in the firm’s first quarter letter to investors that Institutional Investor has obtained. He said that the fund had “a relatively large, long exposure” to Europe and Asia when the U.S. and Israel launched attacks on Iran in February. While stressing that the team doesn’t necessarily have foreign policy expertise, he acknowledged that the portfolio implicitly assumes the conflict will be short-lived. The fund fell 3.66 percent in February.
During the quarter, the biggest gain was from the short book, which added 10.9 percent while the long book gained only 1.9 percent on its invested capital, according to the letter.
Marques became well-regarded at Valiant for his shorting expertise, especially his short of Wirecard, the German payments company that collapsed amid fraud allegations in 2020.
But the hedge fund manager’s view of the world is now firmly in the technological disruption mold, and he thinks short sellers are “missing the plot.”
Marques took issue with some of the tenets of value investing that have informed him (and some short sellers). He acknowledged that value investors, including Pertento, have benefited from pursuing those frameworks as valuations stretched higher. Nowhere was this more evident than across the software sector, where investors learned to put aside current GAAP earnings in favor of assuming that cash flow would be steady years down the line, he said.
That was logical as long as the future looked a lot like the past. “Except, it does not,” Marques said. He sees the collapse in software valuations earlier this year as an early warning sign of a much broader reassessment of the staying power of business models at a time of rapid change.
As for short sellers, he said many remain focused on the wrong threats. Marques added that they “obsess” about familiar criticisms, such as the low adherence rates for GLP-1 drugs, allegations of misconduct around stablecoins, and the overpromising by Musk, dismissing the possibility that massive investments by Amazon and other hyperscalers could lead to meaningful revenue and returns.
Framing the moment in apocalyptic terms, Marques invoked “creative destruction” and warned that what he called four “horsemen” are bearing down on once‑reliable quality stocks.
“The horsemen are coming and we are rushing to adapt to a new investment paradigm,” he said. “Some of our recent shorts are high margin businesses with clean balance sheets and honest management teams that just happen to be in the crosshairs of a new technology roadmap. Trading these narrative shifts requires a different muscle than our traditional frauds, fads, and failures.”
He added that “we are stress-testing our long book by imagining what the J-curve of technology change will look like in the coming years. Technology optimism has become the new form of stock market pessimism.”
Pertento launched in November of 2021, and its first two years were somewhat rocky. It was virtually flat during the two months of 2021 and then fell 2.54 percent in 2022. But given the market’s drop of 18 percent that year, the fund still outperformed. It then gained 22.43 percent, 22.27 percent, and 17.71 percent in 2023, 2024, and 2025 respectively. A share class for early Pertento investors, which has a slightly lower fee structure than the latecomers, showed slightly higher gains.
