Objectives and Approach

Investing can become a game of regrets. If you own an asset that rises in value, you regret not owning more of it and if it falls in value, you regret owning any at all. Rarely if ever does investing leave you feeling – I got that just right. This is why it is important to remember to celebrate the successes when they come. In 2025 we have had more than our fair share of investment successes; the USD share class of the Equitile Resilience fund up 50.1% for the year. These strong returns have been helped particularly by the fund’s holdings in banks and precious metals mining companies, both of which, we believe are beneficiaries of loose fiscal and monetary policies. In addition, the mining companies have also been supported by rising geopolitical tensions. It is common to use the start of any new year as a time to look for new investment themes, with a view to changing the investment portfolio. This year we are consciously resisting this temptation. The forces driving the themes of 2025 are, as far as we can tell, still in place and even intensifying. So, we are not planning significant portfolio changes at this point. That said, we acknowledge some things have changed. Last year, when we began significantly increasing your holdings of gold mining companies, we were comfortably outside the consensus opinion of the investing community. In recent months the ‘debasement trade’ has come more into vogue. We will be watching this development closely; returns are often best while consensus is building but can fade once it is established. Although we do not know when it will become necessary to start adjusting the fund’s holdings significantly, we take comfort in finding the current market to be a target rich environment where we are able to find more companies we would like to buy than we can own. We view equity markets as being in an unusual state of bubble and anti-bubble. Many stocks are trading at wild overvaluations while others are trading at equally extreme undervaluations. We suspect the Artificial Intelligence boom has drained investment capital from large areas of the market leaving behind some very attractive opportunities. We are looking forward to capturing some of those opportunities in 2026.