4Semana·

My portfolio strategy (part 3)

I use the 7 Powers framework from the book “7 Powers: The Foundations of Business Strategy” by Hamilton Helmer. It’s a killer framework for understanding why some businesses create lasting value and compound returns over time.


Each “Power” is a sustainable strategic advantage that lets a company generate outsized returns for a long time. I ask the 7 questions for each stock I am considering to buy.


1. Counter-Positioning

  • What it is: A new entrant adopts a superior business model that incumbents can’t copy without damaging their own biz.
  • Example: Netflix vs. Blockbuster. Blockbuster couldn’t move to streaming without killing its DVD revenue.
  • Why it matters: Creates asymmetric pressure; the old guard is paralyzed.


2. Scale Economies

  • What it is: Unit costs drop as volume increases.
  • Example: Amazon, Costco. Bigger = cheaper = stronger moat.
  • Why it matters: Hard to compete if you can’t match their cost base.


3. Switching Costs

  • What it is: Customers stick around because switching is painful.
  • Example: Adobe Creative Cloud, Microsoft Office, Salesforce.
  • Why it matters: High retention = stable cash flows = compounding machine.


4. Network Effects

  • What it is: The product gets better as more people use it.
  • Example: Meta, Visa, LinkedIn.
  • Why it matters: Leads to dominance, creates a feedback loop of growth.


5. Branding

  • What it is: Emotional or symbolic value, not just functional.
  • Example: L’Oréal, Hermès, Apple.
  • Why it matters: Lets companies charge premium prices and keeps customers loyal even if alternatives exist.


6. Cornered Resource

  • What it is: Exclusive access to a critical asset — talent, IP, data, supply.
  • Example: ASML (EUV tech), Novo Nordisk (Ozempic IP), Ferrari (brand + heritage + team).
  • Why it matters: If no one else can get it, you win.


7. Process Power

  • What it is: Unique internal processes that drive efficiency, innovation, or quality — and are hard to copy.
  • Example: Toyota (lean manufacturing), Amazon (logistics, culture of innovation).
  • Why it matters: Long-lasting edge baked into the org’s DNA.


If I had to chose one, Network effects would be the most important one for me.


Here are my current holdings:

$MSFT (-0,07 %)

$META (-1,93 %)

$MA (-1,24 %)

$BRK.B (+0,39 %)

$AMZN (-0,52 %)

$ASML (+0,24 %)

$MSCI (+0,78 %)

$MC (-1,1 %)

$BKNG (+0,09 %)

$SPGI (+1,23 %)

$ADBE (-0,43 %)

$NOVO B (-1,98 %)

$AIR (+1,52 %)

$CDNS (-1,38 %)

$OR (+0,08 %)

$IDXX (+1,65 %)

$EL (-0,44 %)

$FTNT (-1,07 %)

$LULU (-0,91 %)

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