Month End Recap:
For the month of May, the Caldwell U.S. Dividend Advantage Fund (UDA or Fund) returned 3.2% versus a 6.5% return for the benchmark, the S&P 500 Total Return Index (Index)1. Information Technology was the only sector to outperform the index while Energy, Utilities and Consumer Staples were the worst performers.
Top performers in the month of May were Lam Research (LRCX), CBOE Global Markets (CBOE) and KLA Corp. (KLAC)2. The four major U.S.-listed semiconductor capital equipment (semicap) stocks (which include LRCX and KLAC) were among the best performers in the Index in the month of May. Investors continued to reward the stocks following strong earnings, positive semiconductor industry headlines and optimistic commentary from management teams at investor conferences. We continue to believe that as artificial intelligence (AI) transitions from training (building models) to inference (using models), demand will broaden beyond graphics processing units (GPUs) to a wider range of semiconductors. This should drive increased demand for semiconductor manufacturing equipment from customers whose capital spending plans have historically been more subdued, ultimately supporting upward earnings revisions for the group in late 2026 and into 2027. CBOE continues to benefit from robust trading volumes in its exclusive indexed-licensed products such as VIX options/futures and S&P 500/Mini SPX index options. These products are among the leading options institutional and retail investors use to hedge equity market risk and volatility which has increased, and remained elevated, since the announcement of “liberation day” tariffs in the spring of 2025, and more recently, the Iran war in early 2026. CBOE also reported robust earnings results in early May, including updates on exiting its non-core Australian and Canadian businesses as well as headcount reductions aimed at driving efficiency and improving margins.
During the month of April, the Fund initiated positions in Eli Lilly (LLY), Broadcom (AVGO) and Acadian Asset Management (AAMI).
LLY is a global pharmaceutical leader with a robust commercial portfolio and a highly productive pipeline spanning metabolic diseases, neuroscience, oncology, and immunology. The company continues to solidify its dominant position in the metabolic space through its injectable GLP-1 franchise, which has captured market leadership by delivering superior clinical weight loss results versus other competitors. Their recent rollout of an oral GLP-1, that requires no food or water restrictions, is anticipated to heavily disrupt the market and drive massive volume growth by lowering the logistical and physical barriers associated with injectables. Lastly, LLY’s growth runway is further enhanced by a highly anticipated pipeline of therapies beyond basic obesity treatments, including type 2 diabetes, Alzheimer’s dementia, and addiction.
AVGO designs and supplies advanced semiconductor solutions across data center, networking, and broadband end markets, as well as a robust suite of enterprise infrastructure software. The company maintains dominant leadership in the custom artificial intelligence (AI) application-specific integrated circuit (ASIC) market, partnering with hyperscalers like Google, Meta, and OpenAI to drive strong AI semiconductor growth that is projected to exceed $100 billion by fiscal year 2027. While AI captures the headlines, AVGO should also benefit from an accelerating cyclical upturn in its non-AI semiconductor business as enterprise networking and broadband demand normalize from post-pandemic lows. Lastly, its massive acquisition of VMware has successfully shifted into a durable infrastructure software franchise, providing highly predictable, high-margin subscription revenues that help offset the cyclicality of the semiconductor business.
AAMI operates as a leading global investment management firm that specializes in data-driven, systematic investment strategies for institutional clients. The firm commands a distinct industry leadership position in quantitative equity strategies, by utilizing proprietary modelling to forecast over 40,000 stocks globally. AAMI presents an attractive growth profile underscored by its strong market momentum, highlighted by a notable earnings and revenue beat in early 2026. Lastly, the company’s extensive multi decade track record in emerging markets and expansion into innovative equity strategies provide a diversified product suite capable of generating consistent alpha across varying market cycles.
The Fund held an 14% 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 May 31, 2026:
Caldwell U.S. Dividend Advantage Fund (Series F): 1 Year: 27.2%, 3 year: 13.5%, 5 year: 9.9%, 10 year: 10.1%, Since Inception (June 19, 2015): 9.2%.
S&P500 Total Return Index: 1 Year: 30.0%, 3 year: 24.2%, 5 year: 17.2%, 10 year: 16.2%, Since Inception (June 19, 2015): 15.6%.
2Actual investments, first purchased: LRCX 3/25/2026, CBOE 3/7/2025, KLAC 10/15/2025.
All data is as of May 31, 2026 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: June 8, 2026.