We are pleased to announce that our weighted average return in December was +2.72%, resulting in total net return of +18.39% in 2017. Since 2015, we have generated a net return of 37.30% with a Sharpe ratio of 1.48.
In terms of investment strategy performance, our weighted average net returns were (a) +4.34% for conservative strategies, (b) +15.34% for balanced strategies, and (c) +28.40% for aggressive strategies.
In our November commentary, we mentioned that many of our favoured sectors had performed poorly. In December, they stormed back with a vengeance. Our largest individual equity holding – Canadian mining company Teck Resources Ltd. – rallied 15%. Our largest equity fund holding – the Polar Biotechnology fund – increased by 4.75%. Both have continued to trade up strongly in the New Year.
A year ago, we wrote, “There seems to be a consensus in the air that 2017 will be a year of uncertainty and many challenges. While we understand the rationale for such a stance (a Trump presidency, rising rates, elections in Europe…), we cannot remember a time when any new year was predictable and without challenges. As such, we remain vigilant in trying to be maximally objective in regularly evaluating our current investment strategies, while trying to identify even better risk/reward opportunities going forward.”
Well, Trump is still POTUS, rates are still rising and Europe continues to have elections – and despite all of the ‘expert forecasts’ no one knows what 2018 will bring.
A few months ago, I read a quote that resonated strongly with me: “we remember the past fondly, because it lacks the fear of uncertainty.” The converse implication is that we fear the future because it is uncertain. Yet it serves us well to remember that the march of history has been one of progress. Today, we stand before more profound possibilities than ever before, which also means that the choices that we make will be all the more momentous.
As asset managers, we look forward to these challenges and opportunities and will be steadfast in seeking out new ideas and while continuing to heed the lessons of the past.
Speaking of the lessons of the past, just a couple of days ago we noticed that the world’s five largest cryptocurrencies had the equivalent combined market capitalization of the world’s seven largest publically traded mining companies. Anyone can buy cryptomining kits, and new crypto currencies are being ICO’d every day. It takes a minimum of nine years to build a copper mine. Crypto and blockchain have countless parallels with the boom and bust of the dot-com era. Guess what followed? The largest commodity rally of all time.
History does not repeat itself, but it tends to whistle a similar tune…
On behalf of our Client Portfolio Management team, I thank you for your continued trust and support, and wish you a happy, healthy and prosperous New Year!
FULL DISCLOSURE: Please note that the opinions expressed in this blog should in no way be considered as investment advice or a solicitation to buy or sell securities.