Welcome to The Hermit 🧙‍♂️

The Research Exhaust of an Active Hedge Fund

We find the 5x opportunities Wall Street is structurally forbidden from touching.

The Mission

The Hermit is not a newsletter. It is the direct research pipeline of Equity Focus FIL, an active investment vehicle focused on extraordinary companies with a market capitalization under $2 billion.

Most finance writing is “reactive”, summarizing earnings calls or commenting on the macro news of the day.

We are proactive.

We engage in primary research, scuttlebutt, and forensic analysis to find businesses that are heavily mispriced despite being extraordinarily well-managed.

Why Small Caps? (Our Structural Alpha)

We fish where the whales can’t swim.

• Structural Asymmetry: Big banks cannot deploy capital into these companies due to size constraints. That means no analyst coverage, no efficiency, and massive opportunity.

• Access: Management answers our calls. We visit factories. We verify the data ourselves.

• The “One-Foot Hurdle”: We don’t look for complex puzzles. We look for obvious, mispriced monopolies that are simply too small for BlackRock to notice.

What We Deliver

We aim to get as close to pure certainty as possible. Once we gather the information, we allocate meaningful capital (10%).

Here is what you get when you look over our shoulder:

1. The Institutional Deep Dive (Monthly). A 50+ page thesis based on primary data. We cover the business model, the “Moat,” the risks, and the valuation. This is our owner’s manual.

2. Priority Briefings (Thesis Executive Summary). Exclusive access to the 3-page “TL;DR” version of our Deep Dives. The fastest way to absorb the thesis and the math without reading the full report.

3. The Hermit Portfolio (Audited). We don’t just talk; we allocate. You get detailed updates on exactly what we are buying and selling.

Note: Unlike 99% of financial newsletters, our returns are audited.

4. The Pick of the Week (Saturdays). A concise, high-conviction snapshot of a fresh company in our crosshairs. We focus on undervalued assets, ignored backlogs, or margin expansion stories.

About The Author

I’m Alejandro Yela, Principal Advisor of Equity Focus FIL.

My background is in Investment Banking and M&A, where I spent years in intense Excel marathons and project finance. I earned a bachelor’s in Economics & Law and two Master’s degrees (Management & Finance) from IE Business School.

But credentials don’t generate alpha. Obsession does.

I built The Hermit because I wanted to practice the opposite of speculation. I follow the principles of Peter Lynch, Cliff Sosin, and Charlie Munger: inner scorecards, brutal intellectual honesty, and concentration.

I have sat in the room where it happens:

• Berkshire Hathaway AGMs (2023, 2024, 2025)

• RV Capital AGMs (2024, 2025)

I don’t rely on complex modeling to value a business. If the value isn’t obvious on the back of a napkin, we pass. We look for certainty, we bet big, and we wait.

Stop speculating. Start allocating.

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