Fahy Capital Management Performance & Activities
Net of expenses, the absolute return of our flagship fund is 42% (14% annualized rate of return).
Our debt-to-capital ratio stands at 6%, a low-leverage financial structure that affords us a great deal of flexibility with our strategies.
38% of FY20 FCF has been devoted to day-to-day operations, capital improvements and software development.
Cash reserves stand at 12%.
AMEX Gold Bugs Index Health Check
The AMEX Gold Bugs Index ($HUI) is our primary reference benchmark.
$HUI’s Value Betting Edge (VBE)* sits at an actionable 4%, which although meaningful, is off its extreme readings registered in the final week of February. As we mentioned previously, $HUI’s February VBE represented one of the 6 best buy-side edges offered in the Index’s history, coming within a hair’s breadth (247.99) of tagging our calculated Odds Engine support at 245, a level with an implied probability of 57%.
If February levels are not breached, we expect a resumption of the presiding uptrend to 354, a level with a 2021 implied probability of 83%, which if pierced, opens the door to 415 and then 514.
As reflected in the Index, selling pressure has moderated in NuChemICF holdings Alamos, Barrick, Harmony, and Yamana, which represent 13%, 6%, 6%, and 6% of the NuChemICF respectively.
Gold and Silver Outlook
Gold and silver sport 1% and 9% VBEs respectively, while the dollar’s short VBE has risen to 1%, which is an excellent sign.
Holdings Update
We initiated a stake in Sandfire Resources America at a price of US $0.175 on 20 February.
We initiated a stake in Steppe Gold at a price of US $1.84 on 25 March.
Note
A Value Betting Rating > 1% is actionable.
