Month End Recap:
For the month of December, the Caldwell Canadian Value Momentum Fund (CVM or Fund) declined -1.0% versus a decline of -3.2% for the S&P/TSX Composite Total Return Index (Index). From a sector standpoint, Consumer Staples, Financials, and Consumer Discretionary were relative outperformers, whereas Communications Services, Real Estate, and Materials underperformed.
Top performers in the month of December were Aritzia (ATZ), Tamarack Valley Energy (TVE), and Celestica (CLS). ATZ rerated higher as it experienced a strong uptick in web traffic during December, with Canada returning to growth again after six months as well as accelerating growth in the U.S. This reflects positive consumer response to increased marketing and the excitement from three new flagship store openings, signaling strong momentum and reinforcing investor confidence in the company’s U.S. growth strategy. TVE delivered strong performance as the backdrop of rising oil prices bolstered improving cash flow expectations. CLS continued its strong momentum as its demand is proving to be exceptionally strong, with the company having secured networking programs with three hyperscalers, further strengthening investor confidence in the company.
During the month of December, the Fund did not initiate any new positions.
For the fourth quarter of 2024, CVM gained 6.0% versus a gain of 3.8% for the Index. Top contributors to performance were Celestica (CLS), Atkinsrealis Group (ATRL), and Fairfax Financial (FFH). CLS was also a top performer in the month of December and was already discussed in the monthly section above. ATRL experienced multiple expansion as the company had been trading at a discounted valuation versus its engineering services peers despite growing operating cash flow, improving margins and delivering a class leading rate of organic growth. FFH rerated higher upon delivering a robust quarter driven by considerably improved underwriting income as well as higher earnings through its associates and non‑insurance companies. These constructive developments are expected to be sustained and led to investors improving their outlooks for the company.
The Fund held a 4.6% cash weighting at month-end. While we remain mindful of the macro environment, the Fund employs a bottom-up investment approach designed to seek out attractive investment opportunities in any market. CVM has generated substantial value for investors over its long-term history driven by the combination of strong company-specific catalysts and a concentrated portfolio. We continue to look forward to strong results as we progress through 2025 and beyond.
Standard performance as at December 31, 2024:
Caldwell Canadian Value Momentum Fund (Series F): 1 Year: 18.9%, 3 year: 6.1%, 5 year: 9.7%, 10 year: 8.7%, Since Inception (August 29, 2014): 8.7%.
S&P/TSX Composite Total Return Index: 1 Year: 30.7%, 3 year: 10.9%, 5 year: 11.9%, 10 Year: 8.2%, Since Inception (August 29, 2014): 8.2%.
Actual Investments, first purchased: ATZ 10/4/2022, TVE 5/21/2021, CLS 1/19/2024, ATRL 3/31/2023, FFH 3/21/2024.
The CVM was not a reporting issuer offering its securities privately from August 8, 2011 until July 20, 2017, at which time it became a reporting issuer and subject to additional regulatory requirements and expenses associated therewith.
Unless otherwise specified, market and issuer data sourced from Capital IQ & Morningstar Direct.
The information contained herein provides general information about the Fund at a point in time. Investors are strongly encouraged to consult with a financial advisor and review the Simplified Prospectus and Fund Facts documents carefully prior to making investment decisions about the Fund. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Rates of returns, unless otherwise indicated, are the historical annual compounded returns including changes in unit value and reinvestment of all distributions and do not take into account sales, redemption, distribution or optional charges or income taxes payable by any unitholder that would have reduced returns. Mutual funds are not guaranteed; their values change frequently and past performance may not be repeated.
Publication date: January 21, 2025.