CHARTERIS & “blue chip” gold & precious metals mining companies

Managed by Ian Williams, chairman of Charteris Treasury Portfolio Managers, the WAY Charteris Gold & Precious Metals Fund is invested directly in “blue chip” gold & precious metals mining companies. Circa 20% are mid-cap/smaller gold mining companies with a market capitalization below $500m whereas circa 80% are above that threshold. The portfolio is currently heavily overweight in Canadian companies with the fund having zero exposure whatsoever to South African mining companies. These companies are involved in the mining, refining, production and marketing of gold and/or precious metals and have some of the best assets/mines on the planet both for grade quality and quantity. The fund is the joint top like-for-like Gold fund in the UK out of more than 3200 funds and has achieved a performance of 202.52% YTD (*source FE as at 3/8/16) and 203.04% in the last 12 months (source FE as of 03/08/2016) and a Sharpe ratio of 4.68.

CEO at Charteris and lead fund manager, Ian Williams says, “The reason why we have achieved over 200% YTD is that we have a higher weighting in silver than any other UK fund, circa 65% of our investments are in silver mining equities with the rest in gold mining equities. We focus on investing in strong cash-flow generating companies that are reinvesting their capital efficiently and we do not really like to own exploration stocks because of the illiquidity and uncertainty in their future returns. We can hold some cash and physical metals, but for now there is no point having them in our portfolio given the greater movements in the mining shares. Silver has almost increased 50% YTD (*source Bloomberg) but many of the silver miners have done more than four times this amount.  Stocks such as Fortuna Silver Mining (FSM) and First Majestic Silver (FR) are both terrific examples with both up more than 300% YTD. Going forward we expect our outperformance over any comparative precious metals funds to widen because of the silver element, which cyclically has seen the majority of its move in the second half of the calendar year. 

Gianluca Vitelli, Head of Fund Sales says, "We still see a lot of upward potential in this sector as we think we are still in the first phases of a major bull market. Couple this with the geopolitical risks, a low and in certain cases negative interest rates, global environment and economic concerns mounting in Europe, the case looks strong for gold and in particular silver. Silver also has the advantage of being a major asset in the industrial sector (e.g. Solar Panels & water purification). This year we also have Diwali in late October, Indian wedding season, US elections and Chinese New Year purchases leading up to early 2017 and little chance of another Fed rates-hike until next year. We are also predicting dollar weakness, an increase in global gold ETF inflows and a greater desire by disenfranchised investors to hedge their equities and fixed income risk by allocating more capital to gold and silver in search of higher returns given their limited options."

For more information about the Fund please contact Gianluca Vitelli, ACSI, Head of Fund Sales 

Charteris Treasury Portfolio Managers