The Quality Portfolio

Building a $100K Quality Portfolio for Long-Term Compounding

The Quality Portfolio: Turning Conviction Into Capital

I believe in putting my money where my mouth is. This newsletter is more than research and opinions—it reflects a long-term investing strategy I stand behind. That’s why I’m creating a real-money portfolio based on the principles and ideas shared here.

This "Quality Portfolio" will demonstrate how I build and manage a portfolio from scratch—starting with a clear strategy, followed by transparent decision-making and long-term execution. My goal is to show you how to take the ideas in this newsletter and turn them into a working portfolio with real capital behind it.

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📌 Portfolio Goals

Every successful portfolio starts with a clear objective. Here’s what I’m aiming for:

• 12% Long-Term CAGR

• Consistent Dividend Growth

This isn’t about beating the market quarter to quarter, or chasing short-term dividend increases. The focus is squarely on long-term, compounding results.

I’ll be seeding the portfolio with approximately $100,000, with a 25-year horizon. My goal is to grow that into $2 million through disciplined investing and organic growth—without adding additional capital.

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🔍 The Investable Universe

This portfolio will be built using the Quality + Valuation + Return Potential framework that underpins this newsletter.

Currently, my Quality Score research identifies 19 high-quality stocks. But I’ve found the current approach a bit too restrictive—many good businesses fall outside the cutoffs. To make the process more practical and adaptable, I’ll be redesigning the investable universe to:

• Use a flexible, repeatable stock screener

• Balance quality standards with broader selection

• Emphasize valuation and return potential to filter weaker candidates

This redesign will be documented in a series of future posts, where I’ll share the process behind building and refining the screener. The updated investable universe will be publicly available to all subscribers. However, valuation and return projections will remain behind the paywall—available for just $5/month (the cost of a coffee ☕).

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📈 A Rules-Based Strategy

This portfolio will follow a simple, transparent, rules-based system—designed to reduce bias and make execution easy.

Initial Construction

• 20 equal-weighted stocks (5% each)

• Stocks selected based on highest future return potential

Dividends

• Reinvested into the stock with the highest return potential

• No new capital contributions—growth will be fully organic

Allocation Limits

• Max position size: 7% (via reinvestment only)

• If a stock exceeds 7%, it becomes ineligible for reinvested dividends

Removal Rules

• If a company cuts its dividend, it’s removed

• If future return potential drops below 7%, it will be reviewed

• If removed from the investable universe, it exits the portfolio

Replacements

• Only added when an existing stock is removed

• Replaced with the highest return potential stock not currently in the portfolio

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🎯 The Big Picture

The core principle behind this portfolio is simple: invest in high-quality businesses with attractive return potential, then stay out of the way and let time do the work.

I’m excited to share this journey with you—every trade, every rule, every result. It’s one thing to write about quality investing. It’s another thing to prove it.

Let’s build something that lasts.