Laughing Water Capital, an investment management firm, has published its investor letter for the fourth quarter of 2025. The fund returned approximately 6.8% during the quarter, bringing its net annual return to about 3.9% after fees and expenses. Over the same period, the SP500TR and R2000 indexes returned roughly 2.7% and 2.2%, respectively. For the full year, those indexes finished up 17.9% and 12.8%.
The fund outperformed the indexes last year but has lagged behind them this year. Long-term cumulative returns are emphasized as more significant, with volatility expected to smooth over time. Since inception, the portfolio has returned about 400% on a cumulative basis, compared to approximately 332% for the SP500TR and around 175% for the R2000, which serves as its most relevant benchmark.
In the letter, Laughing Water Capital highlighted stocks including NextNav Inc. (NASDAQ:NN). NextNav provides next-generation positioning, navigation, and timing solutions. On January 15, 2026, its stock closed at $14.93 per share. Over the past month, the stock returned -11.08%, while it gained 14.93% over the last 52 weeks. NextNav has a market capitalization of $2.01 billion.
Regarding NextNav, Laughing Water Capital stated: "NextNav is our wireless spectrum / terrestrial backup to GPS investment. Shares were more or less flat for the year, which of course did not help our performance. The factors here are completely unattractive, and completely irrelevant. The only things that will matter for the success of the investment are getting FCC approval for NextNav’s plan, and what the re-purposed spectrum would be worth."
According to database records, 29 hedge fund portfolios held NextNav at the end of the third quarter, down from 33 in the previous quarter. NextNav is not listed among the 30 most popular stocks among hedge funds. In another article, NextNav was covered alongside small-cap tech stocks on Wall Street's radar. In its third-quarter 2025 letter, Laughing Water Capital noted that NextNav fell 20% due to fears of a government shutdown and concerns about share sales from an estate involved in a spectrum license transaction.