CLIENT PRESENTATION REDWOOD INCOME GROWTH CLASS REDWOOD EQUITY GROWTH CLASS

Transcription

1 CLIENT PRESENTATION REDWOOD INCOME GROWTH CLASS REDWOOD EQUITY GROWTH CLASS

2 DISCLAIMERS Commissions, trailing commissions, management fees and expenses all may be associated with investment funds. Please read the prospectus before investing. The indicated rates of return are the historical annual compounded total returns including changes in share/unit value and reinvestment of all distributions and do not take into account sales, redemption, distribution or optional charges or income taxes payable by any securityholder that would have reduced returns. Investment funds are not guaranteed, their values change frequently and past performance may not be repeated.

3 STONECASTLE INVESTMENT MANAGEMENT StoneCastle Investment Management is a quantitative-oriented (systematic) investment firm focused on the management of Canadian equities. StoneCastle manages our funds using our earnings growth/relative strength focused systematic approach: Redwood Income Growth Class Yielding Equities Redwood Equity Growth Class Growth Equities

4 FUND PERFORMANCE AS AT JANUARY 16, 2017 Redwood Equity Growth Class Total Return % (16/01/2017) 1-Month 3-Month YTD 1-Year 3-Year 5-year Inception Redwood Equity Growth Class Category (Canadian Small/Mid Cap Equity) /- Category (Canadian Small/Mid Cap Equity) Redwood Income Growth Class Total Return % (16/01/2017) 1-Month 3-Month YTD 1-Year 3-Year 5-year Inception Redwood Income Growth Class Category (Canadian Dividend/Income Equity) /- Category (Canadian Dividend/Income Equity)

5 OVERVIEW Market Indicators Economy Markets Sectors Opportunities Ahead

6 16-18 YEAR CYCLES

7 BEAR MARKET INDICATORS Source: StoneCastle

8 ENERGY: 80% RISE IN 12 MONTHS 80% Increase = $51.0 Source: Stockcharts.com

9 YIELD CURVE Source: Stockcharts.com

10 LEI AND 18-MONTH MOVING AVERAGE Source: Bloomberg Source: Bloomberg

11 FINANCIAL CONDITIONS INDEX Source: Bloomberg

12 CONSUMER COMFORT INDEX Source: Bloomberg

13 UNEMPLOYMENT RATE: 12-MONTH MOVING AVERAGE Source: Bloomberg

14 ISM MANUFACTURING Source: Bloomberg

15 ISM SERVICES Source: Bloomberg

16 CITI ECONOMIC SURPRISE INDEX Source: Bloomberg

17 ECRI WLI Source: dshort.com/ecri

18 INFLATION EXPECTATIONS Source: Stockcharts.com

19 ECONOMIC ACTIVITY Source: American Chemistry Council

20 MARKET INDICATORS Sentiment Indicators Sectors Surprises & Disappointments What to watch

21 SMALL BUSINESS CONFIDENCE Source: Bespoke

22 AAII BULLISH INVESTORS Source: Bespoke

23 EQUITY OWNERSHIP Source: Gallup

24 DYNAMIC ASSET LEVEL INVESTING Source: Dorsey Wright and Associates

25 TSX: PROS VS. PUBLIC Source: TheUptrend.com

26 S&P/TSX Source: Stockcharts.com

27 TSX MID CAP Source: Stochcharts.com

28 TSX SMALL CAP Source: Stochcharts.com

29 TSX LONG TERM Source: Stockcharts.com

30 SPX LONG TERM Source: Stockcharts.com

31 TSX SECTORS Leading sectors Financials Improving sectors Consumer Discretionary Weakening sectors Energy Industrials Lagging sectors Materials Utilities Consumer Staples Technology Health Care Source: Stockcharts.com

32 SECTOR ALLOCATION: REDWOOD EQUITY GROWTH FUND Sector Weightings Q3 Energy Technology Sector Weightings Q4 Consumer Staples Technology Energy Consumer Discretionary Cash Consumer Discretionary Financials Financials Cash Health Care Health Care Materials Industrials Industrials

33 SECTOR ALLOCATION: REDWOOD INCOME GROWTH FUND Sector Weightings Q3 Sector Weightings Q4 Utilities Technology Consumer Discretionary Utilities Consumer Staples Consumer Discretionary Real Estate Real Estate Financials Financials Health Care Energy Energy Industrials Cash Health Care Cash Materials Industrials

34 SURPRISES Stock Gain Catalyst Teck Resources 500% Coal Prices Increases Aphria 350% Move towards MJ Legalization Calfrac 200% Recovery in Energy and Balance Sheet Improvements Bombardier 165% C Series and Train Orders DISAPPOINTMENTS Stock Gain Catalyst Concordia -90% Heavy Debt, dropping cash flow, regulatory pressures Empire Company -35% Safeway Integration, Weak Sales DH Corp -25% Lower Earnings, accounting questions Element Financial -20% Company separation, Growth trajectory slows

35 WHAT TO WATCH: INSTITUTIONAL SENTIMENT Source: Sentiment Trader

36 WHAT TO WATCH: CAD TO USD Source: Stockcharts.com

37 WHAT TO WATCH: SMALL AND MID CAPS Source: StockCharts.com

38 INCOME FUND: STATISTICS 5-Year Trailing Redwood Income Growth S&P/TSX Total Return Canadian Dividend & Income Equity Standard Deviation Return Sharpe Ratio R-Squared Alpha Beta Upside & Downside Capture 3-Year 5-Year Redwood Income Growth Canadian Dividend & Income Equity Source: Morningstar. Data as of December 31, 2016

39 THE PLAYBOOK Indicators on Offence Investors under exposed Buying Opportunity in a Long Term Bull

40 QUESTIONS?