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* Since inception of the strategy (annualized).
** Since inception of the strategy May 2009. Fund returns from January 2010.
*** Since inception of the strategy June 2010. Fund returns from November 2010. The Benchmark equals 50% CAD T-Bills / 50% Merrill Lynch High Yield Master II.
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Global equity markets had a strong start to the year with small cap names leading the way. Concerns over European debt issues waned as investors focused on positive economic data over the month. Meanwhile, investment grade bond yields (DEX Universe) fell to a new all-time low of 2.3% as bond prices advanced. The Canadian dollar rose 1.2% and is back to parity with the US dollar for the first time in three months.
In Canada, the S&P/TSX Composite Total Return Index (TRI) advanced 4.4%. The largest winning sectors were materials (10.4%), information technology (6.4%) and health care (4.1%). The largest losing sectors were telecommunications (-2.5%), utilities (-0.9%) and consumer staples (-0.1%). The S&P/TSX Small Cap TRI gained 8.9%.
In the U.S., the S&P 500 TRI was up 4.4%, the NASDAQ Composite gained 8.0%, and the Russell 2000 TRI returned 7.1%. The largest winning sectors were materials (11.2%), financials (8.1%) and information technology (7.6%). The largest losing sectors were utilities (-3.6%), telecommunications (-2.8%) and consumer staples (-1.5%).
The MSCI World Index advanced 5.0%. The best performing countries (in USD) were Greece (24.7%), Singapore (14.4%) and Austria (10.3%). The worst performing countries were Portugal (-3.5%), Ireland (-0.8%) and Spain (0.2%).
The Hillsdale Canadian Core Equity Fund, our Canadian large cap long-only strategy, returned 4.8% versus 4.4% for the S&P/TSX Composite TRI. The largest gains came from positions in Suncor Energy Inc., Barrick Gold Corp. and Goldcorp Inc. The largest losses came from positions in Trilogy Energy Corp., TransCanada Corporation and the Canadian National Railway Company.
The Hillsdale Canadian Performance Equity Fund, our Canadian small cap long-only strategy, returned 7.6% versus 8.9% for the S&P/TSX Small Cap TRI. The largest gains came from positions in Poseidon Concepts Corp., Kirkland Lake Gold Inc. and Neo Material Technologies Inc. The largest losses came from positions in Calfrac Well Services Ltd., Cogeco Cable Inc. and Pure Energy Services Ltd.
The Hillsdale US Performance Equity Fund, our U.S. small cap long-only strategy, returned 8.3% versus 7.1% for the Russell 2000 TRI. The largest gains came from positions in Charles River Laboratories, QLogic Corporation and NetGear, Inc. The largest losses came from positions in RPC, Inc., Liquidity Services, Inc. and Complete Production Services, Inc.
The Hillsdale Canadian Long/Short Equity Fund returned 1.6% versus 4.4% for the S&P/TSX TRI. The long portfolio contributed 5.1%, with the largest gains arising from positions in Lululemon Athletica Inc., Pacific Rubiales Energy Corp. and Silver Wheaton Corp. The short portfolio contributed -3.5%, with the largest losses coming from positions in West Fraser Timber Co. Ltd., NovaGold Resources Inc. and Fortress Paper Ltd. The fund is currently $1.46 long and $0.81 short for a net market exposure of 65%. All sectors are net long.
The Hillsdale Global Long/Short Equity Fund returned 0.0% versus 5.0% for the MSCI World Index. The long portfolio contributed 0.1%, with the largest gains arising from positions in CF Industries Holdings, Inc., Finning International Inc. and Apple Inc. The short portfolio contributed -0.1%, with the largest losses coming from positions in Bank of America Corporation, Empresas ICA SA and D.R. Horton, Inc. The fund is currently $1.38 long and $0.72 short for a net market exposure of 66%. The portfolio is net long health care, information technology and energy, and net short financials and industrials.
The Hillsdale Enhanced Income Fund returned 1.9% versus 1.5% for its benchmark. All non-hedging components contributed positively to performance over the month. The Fund is currently allocated 51.2% to high dividend yielding equities and REITS, 33.7% to high yield bonds and 15.1% to inverse ETFs. The Fund is generating yields of 7.4% on bonds, 6.3% on REITs and 5.9% on equities before leverage of 2.1x. Beta to the equity market (TSX) is approximately 0.2.