The core of TCI's strategy is investing exclusively in companies with high and sustainable barriers to entry, a principle popularized by Warren Buffett. These 'moats' include natural monopolies (airports), complex intellectual property (aircraft engines), network effects (Visa), and high customer switching costs.
TCI operates a highly concentrated portfolio, typically holding only 10-15 stocks, which contrasts sharply with diversified funds. This approach is paired with a long-term horizon, with an average holding period of eight years, allowing the thesis for each company to fully play out.
TCI is not a passive investor and will actively intervene to influence corporate strategy and governance. The firm has a track record of forcing major corporate actions, such as the sale of ABN AMRO, blocking Safran's acquisition of Zodiac, and pursuing a criminal complaint against Wirecard.
The success of the TCI fund directly fuels the TCI Foundation, which has become one of the world's largest charitable organizations with over $6.5 billion in assets. The foundation focuses on high-impact areas like climate change, child malnutrition, and healthcare in developing nations, particularly in Asia.
TCI maintains a strict definition of an investable company, narrowing the global universe to only about 200 candidates. The firm explicitly excludes entire industries it considers structurally flawed or unpredictable, such as banks, the auto industry, retail, and insurance.
Keep pulling the thread on Sir Chris Hohn.