Month End Recap:
For the month of July, the Caldwell U.S. Dividend Advantage Fund (UDA or Fund) gained 5.5% versus a gain of 3.6% for the S&P 500 Total Return Index (Index)1. From a sector standpoint, Information Technology, Utilities, Industrials were relative outperformers, whereas Healthcare, Consumer Staples, and Materials underperformed.
Top performers in the month of July were Comfort Systems USA (FIX), Interactive Brokers Group (IBKR), and InterDigital (IDCC)2. FIX moved higher after delivering strong quarterly results and highlighting a robust growth outlook. Management emphasized record backlog levels and continued expansion in the service segment, supported by solid demand in high-opportunity sectors such as technology and health care. Modular construction revenue has grown to represent a larger share of the business, benefiting from efficiency gains, favourable pricing, and automation investments. The company’s disciplined project selection, focus on major customers, and diverse portfolio across industries reinforced confidence in sustained earnings strength into the next year. IBKR continued its surge, driven by strong business momentum, highlighted by a significant year-over-year increase in client daily average revenue trades (DARTs), reflecting heightened trading activity and higher commission revenue. This growth signaled continued strength in client engagement and platform usage, reinforcing confidence in the company’s earnings power and long-term outlook. IDCC advanced after reporting record annualized recurring revenue, driven by strategic licensing agreements that reinforce its leadership in next-generation mobile technologies. The company has achieved 80% penetration of the global wireless market and is actively expanding into high-growth areas such as 6G, Internet of Things (IoT), and healthcare, without incurring significant additional research and development costs thanks to its strong existing intellectual property (IP) portfolio. Management highlighted new and renewed licensing opportunities, including a recently signed agreement with Samsung, which underscores the value of its patents and is expected to support future negotiations. Diversification into adjacent verticals, ongoing discussions with major streaming players, and a focus on sustainable business practices further strengthened investor confidence in its growth trajectory.
During the month of July, the Fund initiated positions in KKR & Co. (KKR) and Booking Holdings (BKNG).
KKR is a leading global asset management firm offering services in alternative asset management, capital markets, and insurance solutions. The company is benefiting from a series of positive developments, including stronger-than-expected capital formation trends, upside to management fee-related earnings, and robust performance fee generation. Fundraising momentum remains solid across flagship strategies, while deployment activity is supported by a healthy pipeline of high-conviction opportunities. The company is also seeing improving performance in key investment vehicles, enhancing the outlook for monetization and carried interest. These factors, combined with disciplined expense management, reinforce confidence in sustained earnings growth and long-term value creation.
BKNG is a global leader in online travel services, operating brands like Booking.com, Priceline, Agoda, Rentalcars.com, and KAYAK. It connects travelers with accommodations, transportation, and experiences in over 220 countries, leveraging technology and a broad supplier network to deliver a seamless booking experience and capture demand across leisure and business travel. The company is benefiting from an improving direct traffic mix, which is driving stronger margins. The company is also leveraging artificial intelligence to enhance customer engagement and expand its connected trip transactions, increasing wallet share and reinforcing its long-term growth potential.
The Fund held a 12.7% 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. Over the long run, given its unique momentum-driven investment approach and focus on well-managed, dividend growth companies, we believe UDA is well-positioned to provide strong performance by way of both attractive regular monthly distributions and long-term capital appreciation potential. We expect that our approach to dividend growth investing should continue to provide a means of generating compelling risk-adjusted returns for our investors over the long term.
1All returns (for the fund, individual stocks and sectors) are in total return, Canadian dollar terms. All stock returns represent performance for the full period noted. All fund returns are in respect of Series F.
Standard performance as at July 31, 2025:
Caldwell U.S. Dividend Advantage Fund (Series F): 1 Year: -2.1%, 3 year: 8.7%, 5 year: 8.6%, 10 year: 8.1%, Since Inception (June 19, 2015): 8.2%.
S&P500 Total Return Index: 1 Year: 16.4%, 3 year: 20.1%, 5 year: 16.6%, 10 year: 14.4%, Since Inception (June 19, 2015): 14.8%.
2Actual investments, first purchased: FIX 5/1/2025, IBKR 4/10/2025, IDCC 2/27/2025.
All data is as of July 31, 2025 sourced from Morningstar Direct or S&P Capital IQ, unless otherwise indicated. Fund returns are from FundData. UDA, Index total return numbers, sector returns and individual stocks returns are in CAD terms. The Fund was first offered to the public as a closed-end investment since May 28, 2015. Effective November 15, 2018 the Fund was converted into an open-end mutual fund such that all units held were redesignated as Series F units. Performance prior to the conversion date would have differed had the Fund been subject to the same investment restrictions and practices of the current open-end mutual fund.
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. The payment of distributions should not be confused with a fund’s performance, rate of return or yield. If distributions paid are greater than the performance of the fund, your original investment will shrink. Distributions paid as a result of capital gains realized by a fund, and income and dividends earned by a fund, are taxable in your hands in the year they are paid. Your adjusted cost base (“ACB”) will be reduced by the amount of any returns of capital and should your ACB fall below zero, you will have to pay capital gains tax on the amount below zero.
Publication date: August 18, 2025.