Wutherich & Co. November 2013 Newsletter

Wutherich & Co. November 2013 Newsletter

by wilwutherich on December 4, 2013 · 0 Comments

Monthly Message
The Wutherich & Co. Composite was up 2.3% in November. This compares with the S&P 500, up 3.0%, the DJIA up 3.8%, the NASDAQ up 3.6%, the S&P/TSX up 0.5%, while the BMO Small Cap Index was up 1.3%. November follows a string of strong months with another good result. Synchronized world growth, though modest, seems to be winning back investors to the equity markets. Headlines, schizophrenic as they always are, take equal time declaring that markets are over-priced, fairly-priced or under-valued. The only thing that we declare is that we don’t know the market’s value and it is futile to spend too much time trying! We do spend a lot of time figuring out if individual companies are under-priced. While we admit it is more difficult these days, we always find opportunities to invest in. We were featured in a recent profile in the annual Investors Guide put out by Canadian Business magazine. While we encourage you to buy a copy, if only for the great picture of Wil in his birthday suit (his wife bought him this suit for his birthday), please ignore the 10 year performance number of 6.8%. They appear to have made an error. The fund that the magazine refers to has not been around for 10 years as it was only seeded in February of 2007. The 10 years to August 2013 for the Wutherich & Co Composite, which has been around since Oct. 1, 2001, produced an annualized return of 13.7%.
The following table illustrates the performance of the Wutherich & Co. Composite to the present:
(unaudited, since Sep.30/01)*

	Month	1YR	3YR	5YR	10YR	Inception
Wutherich & Co.	2.3%	27.5%	19.5%	20.1%	13.2%	16.0%
BMOSCI-wtd	1.3%	8.3%	-0.3%	19.0%	7.5%	10.2%
S&P/TSX	0.5%	12.9%	4.1%	10.9%	8.3%	8.3%

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		64.29%
	Energy	22.27%
	Financials	0%
	Information Technology	0%
	Communications and Media	0%
	Consumer	5.12%
	Healthcare	4.56%
	Industrials	20.98%
	Materials	6.08%
	Telecom	0%
	Transportation	5.28%
	Utilities	0%
U.S. Stocks		21.07%
	Energy	6.90%
	Specialty Retailers	7.38%
	TRANSPORTATION	6.79%
Cash and OtheRS		14.64%

Performance

(unaudited, the growth of $100,000 invested as at Sep. 30/01)*

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

	Annual fees are 1.5% of assets on a quarterly basis in arrears, plus applicable taxes.
	Institutional clients qualifying for a segregated fund account would be charged 1% for the first $10 million and 0.5% for the next $40 million.
	Fees on any accounts over $50 million would be subject to negotiation.
	Minimum account size is $250,000.
	Investments are 100% RSP eligible.

*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.