AI summary and analysis
The 2024 half-year letter disclosed low turnover and new buys in Texas Instruments, and stated that during the half-year period Fundsmith placed more emphasis on long-term free cash flow than short-term price action.
Key points
- The letter disclosed that the portfolio turnover rate in the first half of the year was only 3.7%, indicating that Fundsmith still insists on few transactions and long-term holdings.
- Buying Texas Instruments reflects Smith's focus on long-term demand for analog and embedded semiconductors, capital discipline and manufacturing capabilities.
- He did not force a full portfolio valuation at the semi-annual stage because free cash flow is seasonal and short-term data can be misleading.
- This letter is suitable to be read together with the 2024 annual letter: actions will be given first in the semi-annual period, and AI, indexes and market structures will be explained in the annual period.
- At its core, it puts Fundsmith's style into action: not standing still at all, but slowly accumulating as quality and price rematch.