Factors impacting this quarter

In the past we have highlighted the three best and worst stock performers within the portfolio. In the past the reasons for the increases or decreases was generally specific to each stock. However, when we consider the environment in the fourth quarter, with the oil price collapse and recession fears, it is not surprising that the bottom six names were energy and base metal stocks. It is also not surprising that the top six names in the portfolio were gold stocks.
The following graphs illustrate the current portfolio’s sector exposures:

 

The largest negative contributor to the portfolio last quarter was the energy sector. As WTI moved above $70/barrel, the increased cash flows of the oil and gas companies went into the ground creating additional supply and a strong inventory build (despite the very solid demand picture). Further to this increasing supply picture, Trump asked the Saudi’s to increase their production to offset the incoming sanctions on Iran. When Trump did not follow through with the sanctions, the world found itself awash in oil causing WTI to plummet.

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