Touzani Letters · No. 4
Patience Is a Position, Not the Absence of One
Mourad Touzani, Founder & Portfolio Manager · July 18, 2026 · 5 min read
Holding cash while nothing meets the bar looks, from the outside, like doing nothing. It is a decision with a cost, the return that cash is not earning elsewhere, weighed against the cost of buying something that does not clear the bar. Call it what it is: a position, held on purpose.
Idle capital is not idle
Uncommitted capital has an opportunity cost every day it sits uncommitted. That cost is real, and pretending otherwise is not discipline, it is denial. The question is not whether waiting is costly. It is whether the cost of waiting is smaller than the cost of forcing capital into an opportunity that has not earned it. Most of the time, for a selective strategy, it is.
Activity gets mistaken for effort
A portfolio that changes every quarter looks like it is working hard. A portfolio that holds the same six positions for three years can look, to an outside observer, like it stopped working. Neither appearance tells you anything about the quality of the underlying decisions. Turnover is not evidence of diligence, and stillness is not evidence of neglect. The work happens in the underwriting, whether or not a trade follows from it.
What makes patience a decision instead of a habit
The difference between disciplined patience and simple inaction is whether the bar for action is written down and applied the same way each time, or adjusted whenever waiting starts to feel uncomfortable. A bar that moves to justify whatever is available this quarter is not patience. It is impatience wearing patience's language. The test: could someone else, reading the stated criteria, predict which opportunities would clear the bar and which would not, before knowing the outcome? If the criteria only make sense in hindsight, they were not criteria.
Where this leaves capital allocation
We hold cash when the opportunity set does not clear our bar, and we treat that as an active choice with a cost we accept, not a default state we fell into. The investment philosophy page describes patience as part of capital allocation for exactly this reason. It is not the absence of a decision. It is the decision, made repeatedly, that nothing available today is worth what waiting costs.
This article is general commentary on investment philosophy and does not constitute an offer, solicitation, personalized investment advice, or a recommendation to buy or sell any security. See the disclosures page for the firm's full disclosures.