March Recap:
The Caldwell Canadian Value Momentum Fund (“CVM”) gained 3.2% in March versus a gain of 4.0% for the S&P/TSX Composite Total Return Index (“Index”)1. The dispersion of sector performance narrowed in March versus last month with Consumer Staples, Gold and Materials as top performers. A few major Consumer Staples companies reported strong earnings results with margins coming in higher than expected due to strong pricing power. Steadily higher spot prices and positive guidance outlooks led to price target increases on some Canadian Gold names while the Materials sector benefited from higher commodity prices overall, particularly fertilizer as a result of Russia’s invasion of Ukraine. Consumer Discretionary, Information Technology and Financials were relative laggards.
Top performers in the Fund were Karora Resources ("KRR", +22.1%), Nutrien ("NTR", +19.1%) and Tourmaline Oil ("TOU", +15.6%)2. KRR was a leading performer for the second consecutive month on a combination of higher commodity prices (including Nickel exposure that can help offset higher production costs at current spot prices), solid earnings/guidance and rising analyst price targets. The company is also progressing well towards its 5-year production targets and has already demonstrated strong cost controls through operational efficiencies on its core Beta Hunt mine. NTR similarly benefited from rising fertilizer prices as a result of the Russia-Ukraine invasion. TOU’s earnings were in line with expectations however higher commodity prices, an improving balance sheet and a strong focus on shareholder returns should benefit the company over time.
The Fund held a 27% cash weighting at month-end. CVM has generated substantial value to 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 2022 and beyond.
1See page 2 for standard performance data.
2Actual Investments, first purchased: KRR 12/3/2020 , NTR 11/18/2021, TOU 6/11/2021.
3Return since August 15, 2011 (Perf. Start Date): CVM (Series A) 11.5%, Index 8.5%. | Returns are annualized for periods greater than one year.
4Categories defined by Canadian Investment Funds Standards Committee (“CIFSC”).
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.
As the constituents in the CIFSC Canadian Equity category largely focus on securities of a larger capitalization and CVM considers, and is invested, in all categories, including smaller and micro-cap securities, we have also shown how CVM ranks against constituents focused in the smaller cap category. The above list represents 6 of a total of 398 constituents in the CIFSC Canadian Equity category.
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.
FundGrade A+® is used with permission from Fundata Canada Inc., all rights reserved. The annual FundGrade A+® Awards are presented by Fundata Canada Inc. to recognize the “best of the best” among Canadian investment funds. The FundGrade A+® calculation is supplemental to the monthly FundGrade ratings and is calculated at the end of each calendar year. The FundGrade rating system evaluates funds based on their risk-adjusted performance, measured by Sharpe Ratio, Sortino Ratio, and Information Ratio. The score for each ratio is calculated individually, covering all time periods from 2 to 10 years. The scores are then weighted equally in calculating a monthly FundGrade. The top 10% of funds earn an A Grade; the next 20% of funds earn a B Grade; the next 40% of funds earn a C Grade; the next 20% of funds receive a D Grade; and the lowest 10% of funds receive an E Grade. To be eligible, a fund must have received a FundGrade rating every month in the previous year. The FundGrade A+® uses a GPA-style calculation, where each monthly FundGrade from “A” to “E” receives a score from 4 to 0, respectively. A fund’s average score for the year determines its GPA. Any fund with a GPA of 3.5 or greater is awarded a FundGrade A+® Award. For more information, see www.FundGradeAwards.com. Although Fundata makes every effort to ensure the accuracy and reliability of the data contained herein, the accuracy is not guaranteed by Fundata.
Publication date: April 14, 2022