The scoreboard

Roll on CME 2.5% open. Voting order: Margaret, Daniel, Priya, Iris. Ops abstains.

Case: rate-complex derivatives toll booth — fee per contract cleared, counter-cyclical, monetizes the bear-steepener Priya frames. FY2025 10-K (SEC XBRL): $6.52B rev (+14% YoY), $4.23B op inc (~65% margin), $11.16 EPS, $4.28B OCF; ignore the $198B asset gross-up (clearing collateral). Beta 0.26 — deepens the low-vol tilt alongside V 0.78 / SPGI 1.10. Name ran -8.5% over 10 sessions into the buy — buying weakness. Clears the live gate at 2.5% (would_clear=true, no breaches), funded out of the SPY block. Loss path per Iris: ~25 bps NAV on -10%, ~50 bps on -20% stress; stop -15% rel / ~37 bps.

Daniel votes AYE and files. Binding constraint from here is the Financials sector-vs-SPY band — V + CME ~5.5% active, sector to ~8% active vs SPY. Next legs come from other sectors. Campaign toward the 18-name floor continues.

Roll on V 3.0% open. Voting order: Margaret, Daniel, Priya, Iris. Ops abstains.

Case: VisaNet toll-booth, fee on volume, zero credit risk — top-left quality on Priya's late-cycle / real-rate frame. FY2025 10-K (SEC XBRL): $40.0B rev, ~60% op margin, $23.1B OCF on $20.1B NI (>100% conversion); +17% rev YoY; beta 0.784, low-vol pull alongside XOM/SPGI. Clears the live gate at 3.0% (would_clear=true, under 3.5% band), funded out of the ~95% SPY block — migration, not concentration. Loss path per Iris: ~30 bps NAV on -10%, ~60 bps on -20% stress; stop -15% rel / ~45 bps.

Daniel votes AYE and files. Binding constraint from here is the Financials sector-vs-SPY band (V+SPGI ~5.5% active), not the single-name gate.

Roll on SPGI 2.5% open. Voting order: Margaret, Daniel, Priya, Iris. Ops abstains.

Case: index/ratings/data toll-booth, top-left quality, cleanest single-name read on Priya's late-cycle / real-rate frame. Numbers reconciled across EODHD TTM-MRQ and FY2025 10-K. Beta 1.105 — only above-1 name on the board, carries the quality-compounder slot vs V/CME low-vol tilt. Loss bounded (~25 bps NAV on -10%, ~50 bps on -20% per Iris). Clears gate at 2.5%.

Daniel votes AYE and files. Watch as the book fills: financials sector band (V+CME+SPGI ~8% active) is the binding constraint, not the single-name gate.

Three starter theses filed for today's vote, all from FY2025 10-Ks (SEC XBRL), all consistent with Priya's late-cycle / real-rate frame.

V — buy 3.0%, conv 5. VisaNet rails, clip of volume, no credit risk. $40.0B rev / $24.0B op inc (~60% op margin) / $23.1B OCF vs $20.1B NI — >100% cash conversion. Owners' earnings I can count when reals >2%; +17% rev YoY; beta 0.78. 28x trailing — pay up for quality, not cheap-and-bad. Clears gate at 3%.

XOM — buy 2.0%, conv 4. Inflation-hedge leg. $52.0B OCF held >$50B despite softer crude; ~4% float retired YoY; 2.8% yield; beta 0.18. Underwrite the distribution, not the oil tape. NB: 3% trips the energy sector-vs-SPY band (energy ~4% of index) — sized to 2% to clear and to avoid chasing with oil -4% on the month.

CME — buy 2.5%, conv 4. Counter-cyclical toll booth that monetizes the bear-steepener. $6.52B rev / ~65% op margin / $11.16 EPS. Rate-repricing => rate-complex hedging volume. Beta 0.26. Ignore the $198B asset gross-up (clearing collateral). Tell to watch: quarterly rate-complex ADV.

Structure flag for Daniel/Iris: V + CME both Financial Services (~5.5% combined) — each clears standalone vs the gate; watch the financials band as the book fills. COST stays a watch (50x; step in on a 20% drawdown).

late-cycle / re-accelerating inflation / restrictive real rates / credit complacent

• Rates: 10yr 4.45% (peaked 4.67 mid-May), move is real-rate led (10yr reals 2.06 vs ~1.90) with 2yr pinned ~4.00 — term-premium bear-steepener, not a cut steepener.
• Fed: funds 3.64%, parked since Jan; data-dependent, CPI still grinding (~6.4% 3m annualized headline).
• Credit/vol: HY OAS 274bps, VIX 15 — complacent, priced for perfection.
• Dollar/oil: broad USD firm ~119.3; oil -4% on month.

Tilt for the board: quality + cash-flow yield over long-duration growth while reals >2% and 10yr >4.30%; keep modest low-vol bias. Energy is the structural inflation hedge but the near-term tape softened. Daniel/Margaret — size sector and names against this, not against the index default.