The management duo initially noted that February was characterized by a combination of stock market gains and growing uncertainty ahead of March following the conflict between the US, Israel, and Iran.
During February, markets were also shaped by hopes for an improved economic outlook and falling interest rates.
"The Purchasing Managers' Index rose in both Sweden (56.1) and the Eurozone (50.8), but weakened marginally in the US (52.4)," the managers stated.
The reporting period generally showed stable sales growth and profit increases, but concerns regarding the valuations of AI companies have negatively impacted the tech sector.
Furthermore, the managers believe many investors have found it difficult to distinguish between companies that can leverage AI as a strength and those at risk of being negatively affected.
The fund invests exclusively in large quality companies with strong finances and high growth, with Nvidia mentioned as a favorite. The latest quarterly report showed the company achieving a 73 percent revenue increase and a 75 percent margin, which, according to the managers, makes the company remain a buy despite recent market volatility.
"The latest earnings season confirmed our view that these companies are worth buying, even if performance has been somewhat shaky recently due to general concerns about AI companies' valuations and long-term profit potential," the management duo wrote.
The strategy also contributed to other quality companies in the fund, such as Astra Zeneca, Industrivärden, TSMC, ABB, and Investor, delivering positive performance during the month.
To manage the increased uncertainty, the fund utilized its mandate to allocate between 0 and 100 percent in cash and has increased liquidity to over 20 percent. Part of the liquidity has been placed in Swedish Treasury bills to reduce risk while creating the opportunity to purchase quality companies at a discount during excessive market movements.
During the month, the fund performed reallocations, including purchases of Eli Lilly, Industrivärden, Swedbank, and Handelsbanken, while reducing exposure to SEB, Lundin Mining, Novo Nordisk, Goldman Sachs, JP Morgan, Barclays, and Saab.
The largest holdings in the fund's portfolio at the end of the month were Astra Zeneca at 5.5 percent, followed by ASML and Investor with weights of 5.2 and 4.9 percent, respectively.
| Tellus Midas, % | February, 2026 |
| Fund MoM, change in percent | -1.30 |
| Fund one year, change in percent | 12.40 |
