Share this page with your friends:


Use the player below to listen to a podcast of the commentary, or use the link to subscribe to the RSS feed.

February 2014

The Global Resources Fund posted a gain of 5.44 percent in February as the broader market quickly recovered from a minor pullback at the start of the month.  Fund performance exceeded our benchmark, the Morgan Stanley Commodity Related Index, by 166 basis points in the period.  See complete fund performance here.


  • The fund’s allocation to small capitalization energy and mining stocks outperformed the benchmark during the month as both the FTSE AIM All Share Index and S&P/TSX Venture Composite Index posted an average gain of 7.3 percent versus the 3.8 percent return of the Morgan Stanley Commodity Related Equity Index.  Africa Oilfield Logistics Ltd gained nearly 8 percent in the month.
  • Chemical stocks added incrementally to the fund’s performance during the month, in response to strong earnings reports and free cash-flow generation.  Methanex Corp, Westlake Chemical Corp and LyondellBasell Industries NV all gained more than 10 percent in the month.
  • Higher margins and a rising global demand for protein helped food stocks outperform during the period.  Amira Nature Foods Ltd was a top performer for the fund.


  • Stock selection within the MLP sub-sector negatively impacted fund performance.  Atlas Pipeline Partners LP and Boardwalk Partners had the biggest negative impact.
  • An underweighting in onshore oil service and equipment stocks slowed fund performance in the month versus the benchmark.
  • The limited weighting in private securities weighed on fund performance during a period of strong stock performance in February.


  • China will allocate $35 billion to environmental protection and energy conservation in 2014 in an attempt to control pollution; 50,000 coal-fired furnaces will be shut down and 6 million high-emission vehicles will be removed from roads, while diesel grades will also be raised.
  • China plans to phase out 27 million tonnes of steel capacity in 2014 to enhance environmental protection, energy consumption and technology standards. China’s crude steel capacity reached 1,025 million tonnes by the end of 2013, while 30 million tonnes of new capacity will be built in 2014.
  • China plans to raise city gate prices of natural gas consumed by non-residential users later this year, the National Development and Reform Commission said in its work report issued at the start of the annual session of the National People's Congress. This would be the first natural gas price hike since July of last year, when the central government increased city gate prices for non-residential gas consumers by an average 15.4 percent across the country, resulting in an average city gate price of 1.95 yuan per cubic meter, or about $8.90 million per British thermal units.


  • Given the importance of Russian commodity production and exports for world markets, the threat of economic sanctions on Russia could have important implications for commodity markets.
  • Non-commercial speculative positions in the oil market now stand at the highest level on record.  If this begins to unwind it could be an additional source of potential downside risk to oil prices near term. Indeed, the share of net long positions held by speculators within the total open interest as reported by the Commodity Futures Trading Commission (CFTC) rose last week to 25 percent.

Past performance does not guarantee future results.

The Morgan Stanley Commodity Related Index (CRX) is an equal-dollar weighted index of 20 stocks involved in commodity related industries such as energy, non-ferrous metals, agriculture, and forest products. The index was developed with a base value of 200 as of March 15, 1996. The S&P/TSX Venture Composite Index is a broad market indicator for the Canadian venture capital market. The index is market capitalization weighted and, at its inception, included 531 companies. A quarterly revision process is used to remove companies that comprise less than 0.05% of the weight of the index, and add companies whose weight, when included, will be greater than 0.05% of the index. The Financial Times-Stock Exchange AIM (Alternative Investment Market) All ShareIndex is a capitalization-weighted index of emerging and smaller companies traded on the London Stock Exchange.

Holdings in the Global Resources Fund as a percentage of net assets as of 12/31/2013: Africa Oilfield Logistics Ltd 1.84%, Amira Nature Foods Ltd 0.91%, Atlas Pipeline Partners LP 0.00%, Boardwalk Partners 0.00%, LyondellBasell Industries NV 1.16%, Methanex Corp 1.01%, Westlake Chemical Corp 0.00%.

Net Asset Value
as of 04/17/2014

Global Resources Fund PSPFX $9.70 0.07 Gold and Precious Metals Fund USERX $6.60 -0.08 World Precious Minerals Fund UNWPX $6.32 -0.04 China Region Fund USCOX $8.03 0.08 Emerging Europe Fund EUROX $8.11 0.11 All American Equity Fund GBTFX $31.98 0.01 Holmes Macro Trends Fund MEGAX $23.29 0.07 Near-Term Tax Free Fund NEARX $2.25 No Change U.S. Government Securities Ultra-Short Bond Fund UGSDX $2.00 No Change