This ETF Only Invests in Exceptional Businesses
Yeah, it makes a lot of sense. The O'Shares AKRE Focus ETF, ticker AKRE, was just added to your fund lineup. Congratulations! Can you tell us more about the fund strategy and holdings?
When we find the rare business that really meets our criteria across all three legs of the stool—business, people, reinvestment—the last objective for us is to pay a reasonable price for the shares. That may mean waiting for years, but if we adhere to the discipline, the result should be a concentrated portfolio comprised of exceptional businesses that have been purchased well.
That continues to be the case. We have 16 names in the portfolio today. The top six represent about 60% of the portfolio. Many of the holdings dominate important global ecosystems and choke points in the economy, and they operate as a part of a natural oligopoly.
Mastercard and Visa, for example, are the two dominant global open payment networks. Moody's, for example, is another name that we've held for many years, one of two dominant global debt ratings franchises. Copart is the leading claims cost mitigation business for auto insurers.
We also own businesses that have dominant proprietary data positions that will become even more valuable in an AI world, such as CoStar Group and CCC Intelligent Solutions. We own great capital allocators, going back to the importance of reinvestment. We want to own great capital allocators, and we own those in private capital leaders like KKR and Brookfield, as well as serial acquirers of vertical market software businesses that include Constellation Software, Topicus, and Roper. Different types of businesses, but they all exemplify the three-legged stool criteria.
