Although the Q2 period covers the days between the beginning of April and the end of June, because the fund is in its infancy (it launched June 1st), the period covered here is only one month. Also, considering the fact that the fund is of a long-term nature (i.e. not looking for quick, in-and-out-like trading profits), monthly reports are particularly unrevealing. Nevertheless, it is important that investors receive timely updates on their investments, and this will serve as the first such update.
The market value of one share of KVF rose by 0.25% over the month of June (compared to a -2.4% return of the benchmark index) bringing the value of each share to $10.03 versus the opening share value of $10.00. While it would be nice to say that the average stock in KVF increased by almost 3% in the month as compared to the benchmark, this was not the case. Portfolio returns were aided by favourable currency movements between the Canadian and US dollars. There are no plans for the fund to hedge USD/CAD currency fluctuations. As such, currency movements could affect returns over short periods, but are not likely to be a factor over the long term.
The top performing stock in the portfolio was up 18.1%, while the least performing stock dropped 7.3%. As perverse as it may sound, this dropping stock is good news for the fund's long-term returns, since it offers up an excellent security at better prices. The fund's balance sheet and income statement are included below. (Note that securities are classified as 'held for trading' for accounting purposes and are thus listed at market value, with unrealized gains and losses included in the income statement.)
6 comments:
I like your idea of presenting your investing business in financial statements. Have you considered also presenting a Cash Flow Statement?
Hi Robert,
Perhaps in the future. For now it would not be very useful.
Hi Saj,
Here's a quick suggestion from a fellow value investor: check out FNET. The company has about $2.50/share in cash, and trades for less than half that. Also, very little debt and pretty solid revenues. Seems like a classic Graham cigar butt.
Let me know what you think.
Scott B.
Those are some pretty solid results in this market. Congrats!
Just responding to anonymous' July 10th post but FNET with $2.50 a share in net cash at 3/31/09 trading at about $1.10 per share.
From the company's 10-Q dated 3/31/09:
" At the Shareholders Meeting held on April 17, 2009, the Shareholders approved a special $2.50 per share of Common Stock dividend to be declared by the Board of Directors on such terms and conditions that the Board of Directors may determine in accordance with applicable laws and regulations. The Board of Directors did declare the special dividend of $2.50 per share on April 17, 2009 with a record date of April 24, 2009 and a payment date of May 4, 2009 totaling $27.6 million"
I think that wipes out that $2.50 per share cash, right? Looks like they paid it all out. Don't think this is reflected in various financial screens. So given that, the cash value is gone. Please tell me if I am somehow mistaken as would love to look at this company if I am wrong.
Hi Scott B,
I believe anonymous is correct in that FNET has paid out all that cash. I can see how it looked great without that info tho!
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