Our weighted average return in September was +0.60%, bringing our year-todate return to +13.97%.

Equity markets continued to generate strong returns in September and bond prices weakened due to the continued prospect of higher rates in the US.

Last month, we mentioned that the energy sector looked oversold. We increased our energy exposure and benefited from a continued price recovery in energy stocks.

Our investments in base metal equities did not fare so well, but volatility is part of the price of admission in this sector and we have already seen a nice recovery in October.

Overall, we were not very active in our portfolios last month, but we made one very significant transaction: we sold all of our shares of Shopify Inc. (SHOP US).

We started buying shares of Shopify in our portfolios in September of 2015. Our first share purchase was at $28.19 and we continued to increase our holdings through 2016 as Shopify’s outstanding results continued to confirm and embolden our investment thesis. Earlier this year, we sold half our holdings purely as a function of portfolio maintenance - SHOP had doubled in price and had become too large a holding. A few weeks back, we sold every share that we owned over $116. We still think that Shopify is an incredible company, but sometimes you just have to say thank you and take your money off the table for a while.

On the macro front, US corporate tax reform is back on the table, but we have no idea if or when a bill will actually be passed. Lower taxes would increase corporate earnings. This would be good for US stocks.

In the meantime, yet another earnings season is about to kick off and we will be hard at work confirming or refuting our investment theses and looking for investments that will build wealth for our clients.

Please feel free to contact us if you would like to hear more about our investment strategies.

On the behalf our portfolio management team, I thank you for your continued trust and support!

Pauls Miklaševičs

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