Jean-François Tardif is senior portfolio manager for Sprott Asset Management. Today we look at the Sprott Opportunities Hedge Fund LP.
Total Assets $378-million
Globe 5-Star Rating
Top Five Holdings
Mullen Group, Just Energy, Futuremed, Premium Brands, Jaguar Mining
Past Picks: June 23, 2008
Cervus LP (CVL.UN-V)
Then: $23.89 Now: $11.95
Total return: -44.89%
Morneau Sobeco (MSI.UN-T)
Then: $11.50 Now: $9
Total return: -12.55%
Forbes Energy Services (FRB-T)
Then: $7.54; (sold at $3 on Oct. 22, 2008) Total return: -60.21%
Futuremed (FMD.UN-T) $7.31
"Futuremed distributes medical supplies to the nursing home market. It generates a substantial amount of free cash flow and pays a 13 per cent distribution. The market should keep growing so the company should increase distributions over time. It should also be recession-resistant."
Uni-Select Inc. (UNS-T) $23.60
"Uni-Select distributes auto parts in the after market and generates a substantial amount of free cash flow. This allows it to grow through acquisitions with limited dilution and pay a growing dividend. Uni-Select should be a recession-resistant."
SHORT: iShares S&P/TSX 60 ETF (XIU-T) $14.97
"This is a good hedge against a general decline in the markets."
"I expect the world markets to go up and down as the fight between the deleveraging process and the massive stimulus continues. Since we just had a massive rally in about every asset class in the world (except for bonds), I expect the market to be weak as investors realize that double-digit budget deficits around the world are not sustainable. Investors should sell stocks after an important rally and they should buy after an important correction. These movements will probably last for a few years."
© 2007 The Globe and Mail. All rights reserved.
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