The L2 Micro Strategy rose 12.7% in Q2 2025 while the benchmark Russell Micro-Cap ETF rose 15.4%1. The 2nd quarter was a mirror image of the first quarter. Fear over “Liberation Day” tariffs in Q1 quickly gave way to opportunism with the “TACO” trade in Q2. Stocks generally ended the June quarter where they began the year, despite tremendous volatility in between. The S&P 500, Russell 1000, and Russell Micro were up 10.8%, 11.0%, and 15.4% respectively.
Micro’s performance is actually more impressive than the headline, considering it was generated while three of the largest portfolio positions were its “biggest losers”, subtracting -3.5% from results. Adding insult to injury, the team had such conviction in these three companies that we published research reports on each of them. Superficially, the ill-timed enthusiasm of our publications suggests that we might be morons. In reality this is why we have a research arm with individual ideas and an asset management business with portfolios that benefit from various and sundry risk controls.
L2 Micro Cap – August Q2 2025
Table of contents
When
July 21, 2025
Who
Matthew Malgari
Dr. Sanjeev Bhojraj
Nathan Przybylo
SUMMARY
The L2 Micro Strategy rose 12.7% in Q2 2025 while the benchmark Russell Micro-Cap ETF rose 15.4%1. The 2nd quarter was a mirror image of the first quarter. Fear over “Liberation Day” tariffs in Q1 quickly gave way to opportunism with the “TACO” trade in Q2. Stocks generally ended the June quarter where they began the year, despite tremendous volatility in between. The S&P 500, Russell 1000, and Russell Micro were up 10.8%, 11.0%, and 15.4% respectively.
Micro’s performance is actually more impressive than the headline, considering it was generated while three of the largest portfolio positions were its “biggest losers”, subtracting -3.5% from results. Adding insult to injury, the team had such conviction in these three companies that we published research reports on each of them. Superficially, the ill-timed enthusiasm of our publications suggests that we might be morons. In reality this is why we have a research arm with individual ideas and an asset management business with portfolios that benefit from various and sundry risk controls.