Investment Lifecycle and Strategies

CASE STUDY #1: AMAZON (NASDAQ: AMZN) 2 WE PURCHASED AMAZON IN 2014, AT AN INITIAL PRICE OF ~ $317. Thesis: Amazon was undergoing an investment period at the time, with operating income declining from ~$1.4BN in 2010, to just $178M by 2014. The market was questioning whether these expenses were truly "investments" or whether it was indicated of a lower structural margin in the business. Our analysis indicated that they were truly the former, and we established a position in 2014. Over our holding period, operating margins increased from 0.2% to over 6% by the time of our sale. As the thesis played out and the eventual margin profile was proven to investors, we allowed the position size to decrease within the portfolio, and eventually exited the position. We sold the remaining shares in early 2021, with the last sale ~$3,240. We have publicly discussed Amazon in our previous investor communications here: Q2 2017 Letter, Q2 2018 Letter, Q1 2021 Letter Share Price $3,500 $3,000 $2,500 $2,000 $1,500 $1,000 $500 $310.4 $0 4Q2014 AMAZON $961.4 $675.9 4Q2015 I Shares Owned $2,003.0 $1,735.9 $3,256.9 4Q2016 4Q2017 4Q2018 4Q2019 4Q2020 Share Price % of Total NAV HAYDEN CAPITAL 19

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