• Resource Accounts
    A key focus of our investment strategy, and an area where the firm has particular expertise, is natural resources - such as precious metals (gold, silver, etc.), oil and gas, base metals and forestry.
    While resource stocks sometimes trade at multiples higher than typical value investments, they may play an important role in an investment portfolio due to their ability to act independently of, and often contrary to, the broader market.   Commodities -- and we appreciate that gold is much more than a mere commodity -- can thus provide invaluable diversification benefits to a portfolio of equities, fixed income and real estate.
    Another reason that we find resources to be an extremely attractive investment sector relates to macro global demographic trends and long-term growth in demand for resources.  Global economic development depends critically upon natural resources; robust global economic growth tends to drive upwards the prices of most resources.
    Growth in Asia and other "emerging" areas, particularly China, has spurred demand growth that we consider to be a long-lived secular trend.  China is currently the dominant consumer of many resources including oil (#2 in the world) and copper (#1 in the world).  We believe that significant exposure to natural resources represents an essential long-term "insurance policy" as well as growth play for serious investors.
    Furthermore, because resource industries are cyclical, with high price volatility, they can present money managers with important trading opportunities and the potential to exploit reactionary market conditions such as panic selling or an overly optimistic outlook.  The crash of oil in the late '90s and subsequent snap back in prices is a good example of the volatility that can be exploited by an agile money manager with expertise in this sector.


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