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"1. Wutherich & Co. Newsletter"
| Monthly Message | |
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Happy New Year Everyone! December was a mixed month for the major market indices. The S&P 500 was up 1.0% (up 2.1% for the year), the DJIA up 1.6% (up 8.4% for the year), the NASDAQ down 0.6% (down 1.8% for the year), the S&P/TSX down 1.7% (down 8.7% for the year), while the BMO Small Cap Index was down 1.7% (down 14.4% for the year). The Wutherich & Co. Composite was up 1.5% during the month (up 13.0% for the year). Our mutual fund, the Steadyhand Small Cap Equity Fund, sustained the position that we reported on at the end of November. Morningstar, the fund rating agency, has us at 1 percentile (amongst the top one percent of managers in the small to mid-cap category) for 2011. The Wutherich & Co. Composite that we show in this Newsletter is run the same as the fund. We don’t know if we can repeat such a feat in 2012, but we will certainly commit ourselves to trying! Amongst Canadian large cap stocks, the ten sub-indices finished mixed for the month with Industrials and Telecom Services posting the strongest gains while Materials suffered the biggest loss. Canadian small cap stocks displayed a similar pattern with Industrials and Utilities showing the largest gains and Materials stocks showing the largest decline. We are extremely pleased with how the Wutherich & Co. Composite has performed since its inception and find no reason to change our style. We continue to produce solid long-term returns which have a low correlation to, and less volatility than, our benchmarks. While the world faces serious challenges and we won’t avoid the effects of a global economic slow-down, we think that most of our companies are well equipped to survive and even thrive in this environment. |
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The following table illustrates the performance of the Wutherich & Co. Composite to the present: |
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(unaudited, since Sep.30/01)*
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| Month | 1YR | 3YR | 5YR | 10YR | Inception | |
| Wutherich & Co. |
1.5% |
13.0% | 16.6% | 7.7% | 12.4% | 15.0% |
| BMOSCI-wtd | -1.7% | -14.4% | 27.6% | 2.5% | 9.8% | 11.3% |
| S&P/TSX | -1.7% | -8.7% | 13.2% | 1.3% | 7.0% | 8.1% |
| Wutherich & Co. Factsheet | |
| Company Objective | |
| Our goal is to seek prosperity for our clients through participation in stable, growing companies in North America, led by strong management teams that we consider our partners for the next five or more years. | |
| Investment Philosophy | |
| Our style can be described as concentrated, disciplined, long-term growth stock investing. The focus is on established companies that generally have a demonstrated track record in revenue, cash flow or earnings per share growth, with strong managements and solid balance sheets. The current emphasis in the portfolio is on the equity of small to medium capitalization companies, defined roughly as $50 million to $5 billion in market capitalization. The portfolio may include large capitalization companies if the right elements are there. Stocks are bought with a keen eye to valuation, so you’re not likely to find many high multiple stocks here. The portfolio will likely maintain a significant percentage in foreign securities, providing exposure to investment returns outside of Canada. | |
| Portfolio Composition (as a percentage of net assets) | ||
| Canadian Stocks | 70.32% | |
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Energy | 12.68% |
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Financials | 0% |
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Information Technology | 0% |
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Communications and Media | 4.98% |
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Consumer | 10.11% |
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Healthcare | 6.55% |
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Industrials | 22.38% |
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Materials | 4.87% |
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Telecom | 0% |
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Transportation | 8.76% |
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Utilities | 0% |
| U.S. Stocks | 18.53% | |
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Communication Services | 5.77% |
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Energy | 7.24% |
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Specialty Retailers | 5.52% |
| Cash and Others | 11.15% | |
| Performance | ||||||||||
| (unaudited, the growth of $100,000 invested as at Sep. 30/01)* | ||||||||||
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| Your account with us | ||||||||||
| Wutherich & Company is an independent investment counsellor. We do not hold assets for our clients, but simply exercise trades over your account as per an agreed upon investment policy statement and portfolio management agreement. Your account is held at TD Waterhouse Canada Inc. in your name. Withdrawals from that account can only be sent to you at your designated bank account and/or address of record. Wutherich & Co. may also do withdrawals from your account to satisfy any fees that may apply to your account. All accounts are cash accounts. Unlike hedge funds, we do not use leverage or derivatives to manage your money. Also, we are not a fund company – if you are a private investor with us, your account will mirror the Model Portfolio but your investments are not pooled. | ||||||||||
| Other Facts | ||||||||||
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*The Wutherich & Co. performance shown here is of a composite which combines the performance of all of the accounts managed by Wutherich & Co. that have been invested according to the Wutherich & Co. Portfolio throughout their history. These accounts vary greatly in the size of assets that they contain and whether or not fees have been deducted directly from the accounts during their history. BMOSCI-wtd = BMO Small Cap Index, Total Return, weighted. This index is currently the most comparable to the Wutherich & Co. portfolio due to its average market capitalization, though it may differ greatly in its sector weightings; TSX = S&P/TSX Total Return Index. Due to its large capitalization nature and substantially different sector weightings, this index may not be considered comparable to the Wutherich & Co. Portfolio. |
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