Sprott Gold & Precious Minerals Fund
Investment Team
Charles Oliver
Senior Portfolio ManagerCharles Oliver
Senior Portfolio Manager
Charles Oliver joined SAM in January 2008. He is co-manager of the Sprott Gold and Precious Minerals Fund, Sprott All Cap Fund, Sprott Opportunities Hedge Fund L.P. & Sprott Opportunities RSP Fund.
Prior to joining SAM, Charles was at AGF Management Limited, where he led the team that was awarded the Canadian Investment Awards Best Precious Metals Fund in 2004, 2006, 2007, and was a finalist for the best Canadian Small Cap fund in 2007. At the 2007 Canadian Lipper Fund awards, the AGF Precious Metals Fund was awarded the best 5-year return in the Precious Metals category, and the AGF Canadian Resources Fund was awarded the best 10-year return in the Natural Resources category.
Charles began his investment career with Midland Doherty in 1987 and later joined AGF's Fund Management department in 1999. In 2002 he was named co-manager of the AGF Precious Metals Fund, the AGF Global Resources Fund and the AGF Canadian Resources Fund. In 2004 he was named Manager of the AGF Canadian Small Cap Fund. In 2006 he became co-manager of the AGF Growth Equity Fund and co-advisor on the Markland Oilsands Sector Fund. Charles also helped manage institutional funds and funds domiciled in Japan, Ireland, and the UK.
Charles combines a big picture approach and a bottom up process. Using a portfolio approach he focuses on strong management teams with a sound strategy. He looks for growth at a reasonable price (GARP) and generally buys companies with the view of holding them over the long-term.
Charles obtained his Honours Bachelor of Science degree in Geology from the University of Western Ontario in 1987 and obtained his CFA designation in 1998.
Jamie Horvat
Senior Portfolio ManagerJamie Horvat
Senior Portfolio Manager
Jamie Horvat joined SAM in January 2008. Jamie is co-manager of the Sprott All Cap Fund, the Sprott Gold and Precious Minerals Fund, Sprott Opportunities Hedge Fund LP, and the Sprott Opportunities RSP Fund. Prior to joining SAM, Jamie was co-manager of the Canadian Small Cap, Global Resources, Canadian Resources and Precious Metals funds at AGF Management Limited. He was also the Associate Portfolio Manager of the AGF Canadian Growth Equity Fund, as well as an instrumental contributor to a number of structured products and institutional mandates while at AGF. He joined AGF in 2004 as a Canadian Equity Analyst with a special focus on Canadian and Global resources, as well as Canadian small cap companies. Prior to joining AGF he spent 5 years at another large Canadian mutual fund company as an Investment Analyst.
Jamie was acknowledged for his achievements while at AGF, as a finalist in the Canadian Small/Mid Cap Equity Fund category and as the winner of the Precious Metals Equity Fund category for the second consecutive year along with co-manager Charles Oliver at the 2007 Canadian Investment Awards. Furthermore, the AGF Canadian Resources Fund was awarded the best 10-year return in the Natural Resources category, while the AGF Precious Metals Fund was awarded the best 5-year return in the Precious Metals category at the 2007 Canadian Lipper Fund Awards.
Jamie holds a diploma in Mechanical Engineering Technology (honours) from Mohawk College, and an Honours B.Comm from McMaster University. He is a member of the International Research Association and is a Licensed International Financial Analyst. He is also a member of the Ontario Association of Certified Engineering Technicians & Technologists.
Fund Details
| Fund Status | Open |
| Distributions | Income and Capital Gains Distributed Annually (if any) Distributions are reinvested automatically |
| Fund Code |
SPR 003 - (A) |
| Inception Date | 11/15/2001 |
| Nature of Securities | Mutual Fund Trust Units |
| Type of Fund | Gold and Precious Minerals Fund |
| Valuations | Daily |
| Redemptions | Daily |
| Minimum Initial Investment | $1,000 CDN |
| Minimum Subsequent Investment | $100 CDN |
| Minimum Investment Term | 180 days (3% penalty) |
| Management Fee | 2.5% annual - (A) |
| Performance Fee | 10% of excess over S&P/TSX Global Gold Index |
| Eligible for Registered Plans | Yes |
| Investor Risk Tolerance | High |
Q4 Market Commentary
The Sprott Gold and Precious Minerals Fund Series A (the "Fund") gave up 10.6% during the fourth quarter compared to the 8.7% loss experienced by its benchmark S&P/TSX Global Gold Index.
While spot gold and spot silver fell 3.7% and 9.6%, respectively, during the fourth quarter in CAD terms, share prices of gold and silver stocks experienced an augmented sell-off as investors raised defensive cash and punished any companies that were thinly traded. Tax-loss selling was responsible for additional price weakness and considerable downside volatility during the final weeks of the year.
The late-year sell-off provided an opportunity to establish an approximate 30% allocation in smaller cap issuers which were, in our opinion, dramatically oversold. Stocks that once considered expensive are now truly cheap. Large cap producers also present compelling value, illustrated by Barrick Corp. which, while having grown its EPS 4 fold, has not experienced share price enhancement. Furthermore, with a dividend yield of approximately 1.3%, yield seeking investors will likely start paying attention to gold stocks that carry attractive yields.
On a macro level, we maintain a negative outlook for global financial systems. Measures taken by central banks and governments to appease their respective populaces and protect their financial systems are inherently inflationary which translates into dwindling consumer purchasing power and declining real savings rates. Gold remains a logical asset class for inclusion in most portfolios.
Gold will always carry value, is a simple investment to understand and, most importantly, does not have any liabilities. We have stocks in the Fund that are trading at cash, which is phenomenon we have not witnessed since 2008, and there is explosive upside potential. For example, from October 27, 2008 to April 1, 2009 the S&P/TSX Global Gold Index rose 125%. Smaller cap stocks experienced significantly higher returns.
We are currently seeking out companies with cash on their balance sheets and or whose proven assets are very cheap. We believe that any meaningful stock market recovery will be driven by tangible improvements in Europe. And we believe this will only be achieved by injecting liquidity into their respective systems. And this will give lift to gold and gold stocks prices.
We certainly recognize that 2011 presented performance challenges yet will also recognize that our investment process, which has yielded exceptional long-term numbers, is intact and we are confident that patience and discipline will be well-rewarded.