Sprott Silver Equities Class
Exclusive investing in silver equities and bullion
Chief Executive Officer; Senior Portfolio Manager
Chief Executive Officer; Senior Portfolio Manager
Eric Sprott has more than 40 years of experience in the investment industry. After earning his designation as a chartered accountant, Eric entered the investment industry as a research analyst at Merrill Lynch. In 1981, he founded Sprott Securities (now called Cormark Securities Inc.), which today is one of Canada’s largest independently owned securities firms. In 2001, Eric established Sprott Asset Management Inc.
Eric’s investment expertise is well represented in his track record in managing the Sprott Hedge Fund L.P., Sprott Hedge Fund L.P. II, Sprott Bull/Bear RSP Fund, Sprott Offshore Funds, Sprott Canadian Equity Fund, Sprott Silver Equities Class and Sprott Managed Accounts. His extensive list of accolades include: Canadian Investment Awards’ Opportunistic Strategy Hedge Fund Award (Sprott Hedge Fund L.P., 2004); MarHedge’s Best Canada Based Annual Performance Award (Sprott Offshore Fund Ltd., 2006); HFM Week’s Best Long/Short Hedge Fund Globally (Sprott Offshore Fund Ltd., 2008); and Winner of Absolute Return’s Hedge Fund of the Year (Sprott Capital LP, 2010). Over the years, Eric has personally been the recipient of numerous awards and honours, including one of Investor Digest’s Canada’s Best Investors (2004); Ernst & Young’s Entrepreneur of the Year (2006); Investment Executive’s Fund Manager of the Year (2007); Advisor.ca’s Top Financial Visionary (2011); Terrapinn’s Most Influential Hedge Fund Manager (2012); the 2012 Murray Pezim Award for Perseverance and Success in Financing Mineral Exploration; and the T. Patrick Boyle Award from the Fraser Institute (2013)1. In 2012, Eric was awarded the Queen Elizabeth II Diamond Jubilee Medal by the Governor General and in 2013, he was appointed as a Member of the Order of Canada.
Eric has been elected Fellow of the Chartered Professional Accountants of Ontario (FCA, FCPA), a designation reserved for those who demonstrate outstanding career achievements and service to the community and profession.
Over the years, Eric has also been recognized for his considerable philanthropic endeavours and community contributions. Eric and his family established the Sprott Foundation in 1988 to address urgent human need, hunger and homelessness. He has provided generous endowments to Carleton University, the Ottawa Hospital Foundation, Daily Bread Food Bank and United Way, among others. More recently, Eric donated $1.4 million to CanFund in support of Canadian athletes for every gold medal won at the 2010 Vancouver Olympics. In April 2011, along with Sprott Inc., Eric sponsored a 24-year old Canadian driver James Hinchcliffe, getting him a seat with the prestigious Newman/Haas Racing. In June 2012, the Sprott Foundation donated $25 million in support of the Department of Surgery at the University Health Network.
Senior Portfolio Manager
Senior Portfolio Manager
Charles Oliver joined Sprott Asset Management LP in January 2008. With over 25 years of financial industry experience, he is now Lead Portfolio Manager of the Sprott Gold & Precious Minerals Fund and co-manages Sprott Silver Equities Class.
Prior to joining Sprott, 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. His accolades also include: Lipper Awards’ best 5-year return in the Precious Metals category (AGF Precious Metals Fund, 2007) and best 10-year return in the Natural Resources category (AGF Canadian Resources Fund, 2007).
Charles began his investment career with Midland Doherty in 1987, and in 1999, joined AGF’s Fund Management department. He went on to become Co-Manager of the AGF Precious Metals Fund, the AGF Global Resources Fund, AGF Canadian Resources Fund and the AGF Growth Equity Fund; Manager of the AGF Canadian Small Cap 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 with a bottom-up process, and focuses on strong management teams with 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.
Associate Portfolio Manager
Associate Portfolio Manager
Maria joined Sprott Asset Management LP as a Research Associate in May 2005, and was appointed Associate Portfolio Manager in February 2010. Maria currently co-manages the Sprott Silver Equities Class with Eric Sprott and Charles Oliver. She is also responsible for supporting the portfolio management team in the precious metals and mining space.
Maria has over 12 years of experience in the financial services industry; she began her career at Excel Funds Management as Operations Manager, and subsequently worked in Product Development at Fidelity Investments.
Maria graduated with distinction from the University of Toronto with a Bachelor of Commerce degree and obtained her CFA charter in 2002. She graduated as a Bregman Scholar from the University of Toronto’s MBA program in 2005.
|Issue Price||$10.00 per Unit|
|Distributions||Ordinary Dividends Paid in December; Capital Gains Dividends Paid in February; Distributions are Reinvested Automatically|
SPR 421 - FE (A)
|Nature of Securities||Shares of a Class of a Mutual Fund Corporation|
|Type of Fund||Precious Metals Fund|
|Minimum Initial Investment||$1000 CAD|
|Minimum Subsequent Investment||$25 CAD|
|Minimum Investment Term||90 Days (2% Penalty)|
|Management Fee||Up to 2.5% (Series A) Up to 1.5% (Series F)|
|Performance Fee||10% of Excess over the MSCI ACWI Select Silver Miners Investable Market Index|
|Eligible for Registered Plans||Yes|
|Investor Risk Tolerance||High|
Fund ObjectiveThe investment objective of the Fund is to seek to achieve long-term capital growth by investing primarily in equity securities of companies that are directly or indirectly involved in the exploration, mining, production or distribution of silver. The Fund can also invest in silver and silver certificates.
"ALL THAT GLITTERS IS GOLD (October 2001) was written when gold was still considered a relic in financial circles. We believe silver will be this decade's gold."- Eric Sprott, Markets at a Glance, All That Glitters is Silver, November 2010.
"We believe the investment demand for silver is multiple times higher than that published… the case for physical silver is simply outstanding."
- Eric Sprott, Markets at a Glance, The Silver Lining, June 2010.
Why we believe silver's fundamentals are better than ever:
- Used throughout history as a store of monetary value, silver enjoys growing investment demand due to the debasement of all fiat currencies;
- Currently, the silver-to-gold price ratio is 50:1; however, we foresee a reversion to the historical average of 16:1;
- Silver's value lies in its ability to preserve wealth in environments marked by negative real interest rates, government intervention, severe economic uncertainty and vulnerable banking institutions;
- Silver's unique physical properties, such as its excellent electrical conductivity and proven effectiveness as an antiseptic and disinfectant, add to its increasing demand in industrial, electronics and medical applications;
- World mine supply has grown only moderately over the last decade, lagging the growth in demand;
- China used to be a large supplier of silver to the rest of the world, but is now a net importer of the metal.
Why Invest in Sprott Silver Equities Class?
- Silver equities provide leverage to increasing silver bullion prices in two ways: i) by increasing producers' profit margins; and ii) by incenting exploration upside;
- We consider silver equities to be growth stocks in an environment where few other sectors are growing earnings;
- The Class provides an ideal complement to bullion for investors interested in silver; exposure to both equities and bullion can provide better risk-adjusted returns over the long-term;
- Share Sprott's vast access to investment opportunities, enabled by our relationships with hundreds of precious metals companies, and our location in Toronto, the mining financing capital of the world;
- Rely on Sprott's depth of experience: Sprott has been an active investor in precious metals equities from as early as 2000;
- As part of Sprott Corporate Class Inc., it offers the flexibility of switching to other share classes on a tax-deferred basis.
The Sprott Silver Equities Class Series A (“the “Fund”) fell 15.4% during the first quarter, compared to a 16.8% decline experienced by its benchmark the MSCI ACWI Select Silver Miners Index, as measured in Canadian dollars.
During February and March there was a pronounced sell-off in precious metals miners as hints of the cessation of US money printing programs doused inflationary concerns and put downward pressure on silver. Silver stocks experienced a meaningful downward movement as the group tends to exhibit strong swings in the price direction of the underlying metal they produce. Further adding to the sector’s weakness was the investors’ growing appetite for high-yielding securities, which resulted in selling pressure on small-to-mid cap mining stocks.
At the end of the quarter, the Fund held 24 distinct silver stocks diversified across their respective market capitalizations and geographic focus. Core positions such as Silver Wheaton, Coeur d’Alene Mines and First Majestic Silver, which in aggregate represented 24.9% of the Fund, experienced respective declines of 11.3%, 21.7% and 18% which was significantly worse than silver bullion’s 4.4% (CAD) drop during the same period. The Fund’s smaller-cap positions fared worse as a liquidity premium was felt throughout the sector.
The fundamental reasons for silver ownership remain intact: it is a defensive asset against inflation and its usage in technology devices is increasing. It may take several quarters for silver bullion to resume its longer-term upward trend yet we do believe that silver stocks are cheap and represent strong long-term potential.
The indicated rates of return for series A/class A securities of the Funds are based on the historical annual compounded total returns including changes in unit/share value and reinvestment of all distributions or dividends and does not take into account sales, redemption, distribution or optional charges or income taxes payable by any security holder that would have reduced returns. Investment funds are not guaranteed, their values change frequently and past performance may not be repeated. This communication does not constitute an offer to sell or solicitation to purchase securities of the Funds.