Joseph Sirdevan & Scott Connell – Galibier Capital Management Ltd.
At Galibier, we are focused on the long term and are willing to have short-term fluctuations as long as there is the potential for good long-term absolute returns. With a concentrated portfolio, we expect volatility versus our benchmarks and we are willing to sustain this short-term pain against our long-term objectives.
Adhering to our philosophy of owning companies with enduring competitive advantages and solid long-term growth rates means we generally do not have a lot of exposure to the volatile cyclical industries such as Energy and Materials which happened to be strong in the quarter.
The top performing sector in Canada was Materials, which includes base metals and gold (+27%), followed by Energy (+10%) and Utilities (+7%). The worst performing sector, Health Care, was down (-15%). As prices increased during the quarter, we significantly reduced our exposure to energy and eliminated our one gold position.