The Cro Capital Report

Good morning, and welcome to another edition of The Cro Capital Report, your go-to source for market analysis, energy trends, and our portfolio strategy.

Month-over-month economic Indicators (Sept. 9th - Oct. 9th, 2025)

Portfolio Performance Update: A Reversal Worth the Wait

The Cro Capital portfolio continues its exceptional run, now up 32.20% year-to-date, outperforming all major indexes including the S&P 500 (14.77%) by more than 17 percentage points.

Last week, we discussed how REEMF’s volatility and underperformance had weighed on our gains. This week, the story is completely different. Our decision to add more shares at $0.86 of this Wyoming-based rare earth extraction company has proven to be a strong move, with the stock now trading at $1.17. We know REEMF can be volatile and expect more sharp swings ahead, but we view that as part of its natural price discovery. Our conviction remains that the company is on track to stabilize at levels that better reflect its long-term potential and strategic importance to the U.S. supply chain.

Fluence Energy (FLNC) has also continued its incredible rally. The position is now up 118% this month alone, with shares recently closing at $14.90. The momentum in renewable energy storage remains strong, and FLNC continues to be one of our top performers and highest conviction holdings.

Not every name has participated in this broad rally. Our more defensive positions such as IYK (Consumer Staples ETF), VNQ (Real Estate ETF), and PEP (PepsiCo) have lagged in this risk-on market, slightly limiting overall capital gains. Even so, they remain important to our portfolio’s balance and downside protection.

Reevaluating Tesla

Tesla (TSLA) is currently under review in our portfolio following the recent reductions in federal EV tax credits, which could temporarily dampen consumer demand and pricing power across the sector. While Tesla remains a market leader in innovation, manufacturing scale, and brand dominance, we view this policy shift as a meaningful development that warrants a closer look at near-term fundamentals.

At Cro Capital, a review doesn’t automatically mean a sell. Our process considers a few key questions:

Earnings trajectory – How much will the EV tax credit cut affect TSLA’s margins

Opportunity cost – could reallocating capital to higher-conviction positions improve overall portfolio efficiency/returns?

For now, we’re monitoring how quickly Tesla adapts to these policy changes and whether new product rollouts or pricing strategies can offset potential demand softening. If we determine that the long-term thesis remains intact, we’ll continue to hold. If not, we’ll trim or exit and reallocate capital elsewhere. Our goal is always to stay objective and disciplined rather than reactive.

Shutdown Pressure Builds

The ongoing government shutdown adds another layer of uncertainty to an already fragile economic backdrop. In the short term, markets have taken it in stride, viewing the event as political noise rather than a structural threat. But the longer it drags on, the more pressure builds beneath the surface.

Each passing week without government funding slows economic activity, delays key data releases, and clouds the Fed’s ability to gauge inflation and growth. Consumer confidence and business spending typically weaken the longer Washington remains at a standstill, which can quickly spill over into corporate earnings and equity sentiment.

In short, history shows markets can shrug off brief shutdowns, but duration matters. The longer this one lasts, the more likely it becomes a real headwind for growth and risk assets alike.

Thanks for reading The Cro Capital Report. Please share if you enjoyed!
— The Cro Capital Team

*The information provided in The Cro Capital Report is for informational and educational purposes only and should not be construed as investment advice, a recommendation, or an offer to buy or sell any securities. The views expressed are those of Cro Capital and are subject to change at any time without notice. While we strive to ensure accuracy, we make no representations or warranties as to the completeness or reliability of the content. Always do your own research and consult with a licensed financial advisor before making any investment decisions. Investing involves risk, including the potential loss of principal.