The Principal’s Edge

$1M → $75M+ARR/Exit. Operator turned investor. Using AI as my second brain to find asymmetric opportunities across AI infrastructure. Capital. Conviction. Edge.

[The Principal’s Edge @JRConviction]

I’m not building a portfolio just to watch a number on a screen get bigger.

I’m building freedom.

Freedom to control my time.
Freedom to be present with my family.
Freedom to walk away when I want to.
Freedom to live life on my terms.

The vehicle is a concentrated AI infrastructure portfolio.

The goal is to build this particular port to $5M+ by 2030.

Current 2030 portfolio framework:

NBIS ~ 32%
MU ~ 20%
SKHY ~ 8%
CRDO ~ 5%
NVDA ~ 6%
AVGO ~ 5%
FN ~ 2%
BE ~ 4%
CRWD ~ 6%
Cash ~ 12%

Total ~ 100%

Not through copy trading.
Not through chasing every ticker.
Not through pretending risk doesn’t exist.

The strategy is simple: own high-quality businesses where the fundamentals support the thesis, concentrate when the opportunity is asymmetric, keep cash available, use options strategically, and be willing to change my mind when the facts change.

AI is my second brain.

It helps me research deeper, challenge my own assumptions, track the portfolio, model outcomes and make better decisions ~ but the capital, conviction and accountability are still mine.

And as important as the portfolio is, money isn’t the scoreboard.

For me, life comes down to the four Fs:

Fitness ~ build a body capable of enjoying the life you’re working for.

Finances ~ build enough freedom that money becomes a choice, not a constraint.

Family ~ success means very little if the people you’re doing it for only get what’s left of you.

Faith ~ stay grounded in something bigger than your portfolio, career or net worth.

That’s what I’m building toward.

Capital. Conviction. Edge.

[The Principal’s Edge @JRConviction]

The Edge Report ~ Sept. 24

Good day for the book.

$NBIS ripped nearly 10% intraday and still closed up roughly 7.5%, helping drive the portfolio up about 2.7% on the day ~ roughly $38K.

That kind of move is exactly why I try to separate confirmation from chasing.

I already have a large $NBIS position, so instead of adding into strength, I used the volatility to manage exposure.

Today’s moves:

~ Bought back 3x $NBIS Oct. 16 $200 puts at $3.21
~ Bought back 1x $META Oct. 30 $640 put at $6.70
~ Sold 3x $NBIS Oct. 30 $350 covered calls at $3.23
~ Sold 1x $META Oct. 30 $710 put at $19.08

The $NBIS $200 puts had already done most of their job, so I closed all three, locked in roughly $2.7K, and freed up $60K of assignment capacity

Then with $NBIS ripping higher, I sold 3 short-dated $350 covered calls against only a small portion of the position

That brought in $967 of premium and creates an effective trim level around $353/share if the stock keeps running

That’s how I want to use covered calls, not to cap the core ~ to create a trim valve.

On $META, I closed the old $640 CSP after capturing roughly 72% of the original premium.

Then I moved the acquisition ladder higher and sold the $710 CSP for $19, plus I still have the $680 CSP open too.

META acquisition ladder is now roughly:
$662 effective basis
$691 effective basis

That’s a lot more attractive to me than chasing common near $780.

Good day overall, let's see what tomorrow brings.

[The Principal’s Edge @JRConviction]

@pepemoonboy Bingo.

Spot the pattern early. Follow it to the second and third-order effects. Then use the fundamentals to prove or disprove what you think you’re seeing.

The goal isn’t to predict the future ~ it’s to understand the present before everyone else does.

[The Principal’s Edge @JRConviction]

One of the biggest things I’ve learned from you is that the goal isn’t to win X for the day ~ it’s to still be standing and compounding years from now.

I’ve become a better investor by watching your process, challenging my own thinking and learning to care more about the math than the noise.

Keep teaching, sir. I’m still taking notes. 🫡

[The Principal’s Edge @JRConviction]

@Sandeman52 $399 is just the 12-month target. They’re starting to catch on. The long-term math is where $NBIS gets really interesting. 👀

[The Principal’s Edge @JRConviction]

@babyfolio Exactly. Stocks aren’t sports teams. New information should make you reassess your thesis, not defend your ticker.

The moment criticism of an investment feels personal, conviction has probably crossed into identity.

[The Principal’s Edge @JRConviction]

@BlackPantherCap $NBIS will take care of and possibly bring you that Ferrari.

[The Principal’s Edge @JRConviction]

This is exactly why I try not to get married to any ticker and I have done it in the past.

$IREN can still have real value in power, land and bare-metal infrastructure while also having legitimate weaknesses in managed cloud. Both can be true.

Dismissing independent user feedback as a “hit piece” because it conflicts with the thesis is how investors stop doing research and start defending a position.

The job is to update the thesis when the evidence changes ~ not attack the evidence.

[The Principal’s Edge @JRConviction]

Information is supposed to strengthen or weaken your thesis along the way ~ not be selectively accepted or dismissed depending on whether it makes your stock look good.

I own $NBIS with high conviction, but I’m not married to it. If new information challenges my thesis, I want to understand it, not defend the ticker.

Conviction without intellectual honesty eventually becomes a cult.

[The Principal’s Edge @JRConviction]

This is exactly why I try not to get married to any ticker and I have done it in the past.

$IREN can still have real value in power, land and bare-metal infrastructure while also having legitimate weaknesses in managed cloud. Both can be true.

Dismissing independent user feedback as a “hit piece” because it conflicts with the thesis is how investors stop doing research and start defending a position.

The job is to update the thesis when the evidence changes ~ not attack the evidence.

[The Principal’s Edge @JRConviction]

This is the part of the $NBIS thesis I think the market still underestimates.

Most people model Nebius like this:

MW × GPU rental rate

That may end up being too simplistic.

SemiAnalysis recently modeled that serving open-source models can generate $100M+ per MW per year at the inference layer. That does not mean Nebius automatically captures $100M/MW ~ but it shows how much economic value can exist above raw infrastructure

Now combine that with what SemiAnalysis just said about Nebius:

~ Platinum-tier managed cloud
~ premium pricing
~ rising revenue/MW
~ strong customer feedback
~ short-term capacity auctions
~ prepayments that can approach 100% on 1-year commitments Pasted markdown(4).md

That’s why I keep coming back to this:

The real upside for $NBIS may not be in simply renting GPUs.

It may be in moving up the stack:

power → GPUs → managed cloud → inference → tokens → agent infrastructure

If Nebius keeps executing and captures more value per MW while scaling active capacity, the numbers can get very large, very fast.

My current bull-case path:

2027 ~ $500+
2028 ~ $850
2029 ~ $1,100
2030 ~ $1,300+

Now for the crazy part.

If Nebius eventually proves it can monetize several GW of active compute at $40M-$50M+ per MW, while pushing margins higher through inference and software, then a $500B-$1T market cap stops sounding mathematically impossible.

Depending on future dilution, that kind of outcome could put the stock somewhere around:

$3,000-$3,500+ per share

Again ~ not my base case, not even my normal bull case.

But the math shows how extreme the upside can get if Nebius evolves from a neocloud into a full AI infrastructure + inference platform.

The KPI I care about most now:

Revenue per active MW + margin per MW.

If both keep rising while capacity scales, that’s where the real asymmetry lives.

[The Principal’s Edge @JRConviction]

@DeepValueBagger Wen deal.

[The Principal’s Edge @JRConviction]

This is the kind of independent validation I care about.

SemiAnalysis moved $NBIS into its Platinum tier alongside CoreWeave and called Nebius “unquestionably an industry leader.”

But the bigger takeaway for me is underneath the ranking:

Premium pricing.
Strong customer feedback.
Revenue/MW climbing.
Short-term capacity being auctioned.
Prepayments that can approach 100% on 1-year commitments.
Technical execution strong enough to compete at the top of the market.

That’s the thesis.

$NBIS isn’t just adding GPUs ~ it’s building a differentiated AI cloud that customers are willing to pay a premium for.

Capacity matters.

But quality + pricing power + utilization is where the real edge is.

[Nebius @nebiusai]

"Nebius is unquestionably an industry leader with strong offerings in every category."

SemiAnalysis just gave Nebius a Platinum rating, its highest tier for AI clouds. Less infrastructure firefighting, more building.

Full results: https://t.co/BY5r1LBEfv

[The Principal’s Edge @JRConviction]

@SCHDaccumulator $5M.

At 10%, the portfolio is producing $500K/year.

That’s my definition of escape velocity ~ when my capital can replace my labor.

Everything after that is optionality.

[The Principal’s Edge @JRConviction]

This is the $META thesis in one post.

Models will commoditize. Distribution won’t.

Meta already owns the attention, the intent and the customer relationship. Muse just gives it an agent capable of turning all three into transactions.

That’s an incredibly difficult flywheel to compete with.

[Rihard Jarc @RihardJarc]

It will be hard for anyone to compete with $META Muse. You either compete on the product, distribution or price.

$META is really strong in all three categories:

- The product reviews for Muse are 40k ratings with a 4.88 score (truly rare) telling you users love the product.

- In terms of distribution, $META owns the biggest ecosystem by far.

- In terms of price $META has the most spare infra capacity + enough profits from its core to subsidize if needed.

[The Principal’s Edge @JRConviction]

@JUST_KAWS $GOOGL and it’s not particularly close for me.

Better AI positioning, better optionality, and I’d rather own the company aggressively investing into the next computing platform than the one still trying to prove where its next major growth engine comes from.

[The Principal’s Edge @JRConviction]

@DiligentPlane Fear is only an opportunity when the fundamentals haven’t changed.

Otherwise you’re just buying a falling knife with a motivational quote.