February 2026: You can’t make this stuff up!

In episode #20 of The Active Investor with SGH – February 2026: You can’t make this stuff up! – In this episode of The Active Investor with SGH, Steve Hiscock is joined by CIO Rob Hogg to unpack the key market moves since the start of 2026—from surging precious metals and shifting rate expectations to bond market signals in Australia and Japan. They’re also joined by resources specialist Stephen Gorenstein to explore what’s driving the commodities rally, why this cycle may be more selective than past “supercycles,” and how he’s positioning the ARI fund across themes like gold, copper, and critical minerals

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February 2026: You can’t make this stuff up!

Steve Hiscock:

Hello to everyone listening to our monthly podcast, the Active Investor with SGH. I’m Steve Hiscock, the chair of the company, and it’s my pleasure to be your host again for today’s episode. In today’s podcast, we’re going to look at what’s happened since the start of 2026, and of course, we’ll discuss the outlook going forward.

In addition, we’re really fortunate today to have Stephen Gorenstein join us to discuss the outlook for commodities and resources, which have been on a bit of a tear over the past 12 months, but more on that later. This podcast is being recorded on Monday, the 2nd of February, 2026. So, to start things off, joining me again today as our Chief Investment officer, Rob Hogg.

Hi Rob and welcome back again.

Rob Hogg:

Steve. Thanks. Thanks very much. Great to be back.

Steve Hiscock:

It is great to be back. I was reading your February market update and your opening line is you couldn’t make this stuff up. It is quite difficult to conceive of what Trump is going to do in the future, but certainly he’s been quite active since the start of 2026, talking about Greenland and Iran and the next chair of the US Central Bank.

But before we drill into those sorts of things. Can we start by just having a look at the key market movements since the start of the year?

Rob Hogg:

Yeah, no, absolutely. For sure. And look, I do not know why it’s taken me 12 months to write. You can’t make this stuff up because you can’t. But to the markets so far in 2026, look it’s got to be precious metals. The key focus. And it’s great that we’ve got Steve coming along afterwards to talk about and try and demystify all of that stuff. ’cause what we saw during the month was just incredible rallies across the precious metal grouping. So, gold and silver and platinum. Moving incredibly strongly to record highs.

We saw the US dollar weakening. We saw equities move up a little bit more so amongst smaller caps that was here in Australia and also in the US. We also saw it very much so in Japan with the new Prime Minister there and a lot of talk about increased spending, fiscal spending and so on. Bond markets were relatively sanguine for all of this.

Yields moved up a little bit in the US and Australia. They moved up a bit more in Japan, and that’s part of the whole story that drove Japanese equities as well. We had more of this bear flattening here in Australia. That’s where shorter term yields rise by more than longer term yields. So it’s a bearish move.

Yields going up. So prices going down and a flattening move in the sense that shorter term yields are rising a little more quickly than, or a bit further than longer term yields. And that’s all about the reserve bank and the market moving to increasingly price the likelihood of a rate increase, in fact, tomorrow by the RBA and there were some numbers here during the month particularly employment, but also the CPI that were really right towards the top end of expectations, and that’s just only further cemented what’s happened, and what’s happening in terms of expectations for the RBA.

On the precious metals, and I’m sure Steve will talk about this, as I was saying earlier, this huge rally all the way through until the very last trading day when news broke that US President Trump was talking about nominating Kevin Warsh as his nominee to be the next chair of the Federal Reserve, and that on the day seemed to be a bit of a catalyst. We’ll come back to whether or not he should be a catalyst, but definitely on the day that did seem to be at least coexistent with a sharp turnaround in what had presumably become incredibly stretched positions in these precious metal markets.

Steve Hiscock:

Okay. And when you say catalyst that’s because he’s been traditionally associated with slightly higher interest rates. Is that what you are saying is the catalyst or?

Rob Hogg:

A couple of things. First, was he truly a catalyst? We never really know what the catalyst is in extended markets like this.

Maybe it was just convenient. But there was a turnaround. But on the face of his previous record, yes, he was regarded as a hawk. And if he does indeed become chair of the US Federal Reserve judging by his historic performance, you would expect him to be a little more hawkish than certainly than some of the other potential contenders.

But whether indeed that turns out to be the case is a very open question. He’s after all been nominated by President Trump. And Trump has been as clear about where he wants rates. It just would seem strange that he would nominate someone who is as hawkish as the market seems to think

Steve Hiscock:

As in someone who supports higher rate or ?

Rob Hogg:

As in someone who supports higher rates or less supportive of cutting prices.

Steve Hiscock:

Less supportive of lower rates. Yeah.

Rob Hogg:

There is stuff we know he is quite clear on, Kevin Warsh this is, and that is shrinking the size of the Fed’s balance sheet. So, this QE stuff, he’s never been a fan of that and seems not to be a fan of that. But he has spoken more recently about the Fed’s mania with inflation. And really what that means is just being hawkish as a central bank. So that does raise in your mind questions about whether or not Kevin Warsh 2026 is the same as Kevin Warsh back in March 2011, which is when he left the US Federal Reserve having been a governor for about five years or thereabouts.

Steve Hiscock:

Time will tell on that. The markets have started pretty well this year, generally, despite obviously issues with Trump’s view on Greenland and Iran. Generally, statistically speaking, if January is a positive month, most of the time markets generally have a positive year. Are you sounding a note of caution there or is that what you expect?

Rob Hogg:

Yeah, no, absolutely. What you say is absolutely correct. I’m not sure how high the percentage is, but it’s pretty high. More than 50% of years are positive if January’s positive. But market positioning is also important.

And one of the most interesting things that I’ve happened across so far this year is a report from Goldman Sachs. So Goldman Sachs, as most investment banks do run big strategy conferences early in the year. GS ran theirs in early January in London, I think, and they, so Goldman Sachs made the point after surveying their clients, which they do at the start of the conference, they surveyed their clients and they found that, for example, expectations for the US economy’s growth prospects were much stronger than indeed 80% of surveyed clients expected US growth to be at or above consensus. There was also a very strong consensus for monetary policy easing with an average expectation of 70 basis points of easing by the Fed this year.

So that’s about three cuts. Equity market sentiment was also extremely positive. More than 80% of respondents expecting positive equity returns this year, that’s the highest ever proportion of clients and 42% of clients anticipate double digit gains. That’s also a record proportion. One thing I’ve learned through time is that when you start the year with a very strong consensus position, the risks of it being wrong are quite high.

Steve Hiscock:

Yeah. And what you’re saying in a nutshell is that the majority are expecting stronger growth, but they’re also expecting lower rates. And the whole thing really probably relies on what you’ve referred to in your report there. You need disinflation to keep that Goldilocks situation happening.

Rob Hogg:

That’s exactly what it would be Goldilocks and Goldilocks happens, and maybe in time we’ll get AI productivity and so on and so forth. But it just seems from the way GS have put together this incredibly interesting research that the market is just so incredibly tilted towards the optimistic side that it will be hard to surprise it positively and as well, it’s the composition of the expectations for an expectation of growth being higher than expected, and yet rates, cuts being higher than priced.

You normally wouldn’t see those types of elements in the same room, in the same party at the same time, because you’d imagine they’re more likely somewhat mutually exclusive. So that’s just an air of caution. This whole disinflation story really needs to come through and it’s not abundantly clear that this disinflation story, so that’s lower and lower, but still positive inflation. So, inflation going from 3.4 to 3.3 to 3.2 example you really need that. But some of the underlying data in the US price data is just not exactly singing exactly that same song. It’s tending to show that inflation pressures have bottomed out at 3% year on year, and that’s significantly above the Fed’s target rate of some 2%.

Steve Hiscock:

It’ll need to happen for everything to be, as you say if people are positioned long, generally then good things need to happen above what they’re expecting. Look, let’s move on. You mentioned an interesting subject, which was to sell off in Japanese bonds and the strength of the equity market there.

Can you just talk briefly about that?

Rob Hogg:

Yeah, so Japanese government bonds, or JGB’s as they’re colloquially known, they’ve been selling off for like more than a year. In fact, their 10-year yield’s gone from I think around 70 basis points to now around two and a quarter or thereabouts. And we’ve seen even sharper selloffs with longer maturity bonds. We might say so what? This is Japan and the market’s almost entirely owned by Japanese investors to a much, much higher extent than any other market in the world. So, to some extent, it’s less important for Japanese investors, shall we say and it’s certainly less important for global investors because they’re not big investors in Japan anyway.

But what is important is the fact that the yield on Japanese government bonds is now getting to a level where for Japanese investors, investing in their home market is much, much more relatively attractive. So the risk from all of this is not so much the price effect, which is negative on Japanese bonds.

It’s whether or not Japanese investors decide to sell offshore holdings. So other government bonds US or Europe, Australia. There are huge investors in the Australian market as well. The risk is whether or not the Japanese investors decide we can now bring our money back home. As far as bonds are concerned.

Because the relative yield is much more attractive than it has been. And that’s why what happens in Japan is important. The portfolio flows in and out of Japan are extremely significant, and that’s why this continues to bear watching. And that’s possibly one of the reasons why longer-term yields globally haven’t really rallied much over the last year, and that’s in the environment of JGB yields continuing to rise.

Steve Hiscock:

And when you say attractive, it’s a relative concept, right? It’s 2.2% roughly at the moment.

Rob Hogg:

Yeah, two and a quarter. It is relative and hedging is a factor in all of that as well.

Steve Hiscock:

Yeah. Exactly. Let’s move to Australia. So, you mentioned that and we are without the benefit of knowing what the Reserve Bank will do tomorrow, but even if they don’t make a change, which the market is widely expecting the signs are there that they’re going to have to raise rates and do a U-turn effectively.

Rob Hogg:

Look, it does look like that. The market has and rate expectations have moved enormously from the rate cut back in August.

Steve Hiscock:

Why is that?

Rob Hogg:

down to the inflation story and it’s down to the employment story. So back in August when the RBA did their third rate cut, so Feb, May, August last year, back in August.

The market was expecting more rate cuts, the RBA in their forecasts, and to be fair they used market forwards in their expectations. They were in their estimates talking about rate cuts as well. We’ve swung from that to now expecting a couple of rate increases. Looking out from here why inflation has remained more resilient, and by that we mean specifically domestically generated inflation pressures are still higher than expected and higher than is comfortable. And the story with employment, the unemployment rate is lower than expected and still pretty consistent with a pretty solid employment story.  So now sentiment is switched from one side of the ship to the other.

Now expecting rate hikes almost entirely priced in for tomorrow, for Tuesday the third. And a further rate hike is priced in for later in the year. We think, look, whether they raise rates tomorrow or not we do wonder whether this sentiment has moved too far and perhaps they won’t raise rates on the third.

Because, we’ve already seen in sentiment measures in particular that the outlook for rates has already had a negative impact on consumer sentiment. Consumers don’t always follow their sentiment with their spending patterns, but there’s been a marked slowdown and a falling way in sentiment.

We think there’s the possibility that economic momentum that had picked up investment intentions, spending and so on, that runs the risk of being slowed or perhaps stopped in its steps if the RBA changes tune. So, this seems to us that, with the economy still only growing quite slowly and employment growth growing quite slowly as well. Perhaps the RBA will allow the economy to slow somewhat from the unsustainable. It would seem unsustainable pace that it rocketed to at a lazy 2% at the end of 2025.

Steve Hiscock:

It’ll be interesting to see their accompanying statement as well. Because obviously that will give an insight and certainly give us an indication about the equity market performance going forward given it has definitely built in an expectation of a rate hike.

Just talking about the market, we’ve talked about materials and so on. There’s interest rate sensitive stock sectors, if you like, that have been sold off. Do you want to talk about those?

Rob Hogg:

The ones that have been sold off the most have been really the retail discretionary area.

And that’s all tied up with this sentiment sort of story where household sentiment has really softened, and we see there’s more and more talk about discounting and so on and so forth from the retailers. And really the majority of profit warnings in the last month or so have come from that particular sector.

So that’s really where we see it most prominently, but other sectors, infrastructure and so on that are sensitive to longer term yields which have risen as well as market expectations of rate hikes.

Steve Hiscock:

Yeah REITS.

Rob Hogg:

Exactly. REITS were one of the worst performing sectors. And similar sorts of stocks, they’ve been zapped as well.

And banks haven’t exactly found it the ideal sort of environment either. Resources have done phenomenally well. That’s on the back of this commodity price story. And really, the composition and the drivers of the market have changed quite a deal over the last several months, but there’s a lot of bad news, shall we say, priced in terms of expected rate hikes and what that will do to the consumer.

And perhaps we’ve gone just a little bit too far with some of that negative sentiment.

Steve Hiscock:

Okay. And so maybe there’s some upside there. Rob, to summarize your outlook, markets remain expensive. It’s been a good start to the year. Optimism, the widespread optimism and therefore presumably widespread portfolio positioning is a bit of a concern.

We’ve got a new incoming chair to the Federal Reserve, which is possibly a positive, although we don’t really know. And there’s concern in Australia about the effect of interest rates, but as you say, and that’s partly due to inflation remaining stubbornly high and employment, the fact that it’s so widely built in potentially means that it’s not necessarily as negative for the markets going forward.

Rob Hogg:

That’s exactly right, in terms of the interest rate impact, but just going back to this whole consensus view, that is of such strong and broad evidence that it really does make you sit back and think what could possibly go wrong? And the thing that occurs apart from the geopolitical uncertainty is really this overwhelming expectation that rates will be cut in the US and inflation will behave itself. And that seems to be perhaps the biggest risk to this overwhelmingly positive consensus, which to be fair has as they always do, some basis in fact. And that is that the US economy is doing better than feared to be fair and profit growth has been stronger than expected. So, there is some basis to all of this, but perhaps where we stand today, very early Feb, perhaps if all just got a little bit too optimistic about how things will pan out.

Steve Hiscock:

Terrific. Rob, thank you very much again, as always for your time.

Rob Hogg:

Pleasure. Great to see you, Steve.

Steve Hiscock:

So now let’s move on. Let me start by introducing our very special guest, Stephen Gorenstein. Stephen has been in various roles over what has been an illustrious career. He’s been a geologist. He’s been a mining analyst for Goldman Sachs and Merrill Lynch. He’s had various advisory roles, and now he’s a specialist Resources fund manager and joined SG Hiscock last year. Stephen, welcome to your first podcast.

Stephen Gorenstein:

Thank you, Steve.

Steve Hiscock:

It’s been an amazing 12 months and that’s why we really wanted to get you on to talk about this. It’s amazing 12 months for many commodities. Can we start by looking at some of the key moves in 2025 and why they happened?

Stephen Gorenstein:

Sure. Look, 2025 was a key year, as you say, Steve for commodities. And a number of key themes that we have positioned the fund for did play out and played out quite well. The key three that I’ll name here today were gold, critical minerals, and copper.

Starting with gold.

As the US Federal Reserve moved into an interest rate cutting cycle, gold moved higher. One of the key things people sometimes forget about gold is that it’s a zero yielding asset. When these rates fall, gold becomes more attractive, and that dynamic clearly played out. Secondly, what we saw was the weaponization of critical minerals.

What we observed was the US beginning the reversal of a 30-year trend, which China had effectively taken control of many of the critical minerals. The US started the process of ensuring it has secure access to critical minerals it needs to function. And when I say function, I’m talking about really important stuff such as military and technology. And thirdly, the long impending supply shortage of copper started to finally emerge. Supply disruptions at major mines pushed the market into deficit, pushing prices up towards $6 a pound. And when you combine that with the demand from electrification of the world, you have a very strong price support for copper.

Steve Hiscock:

And certainly, we’ve seen some takeovers as a result of that, right?

Stephen Gorenstein:

Correct. And we’re seeing that obviously with Anglo and BHP trying to merge Rio and Glencore and that is very much around the copper, right? The major corporates, realizing that the world is going to be structurally short copper for the next decade and then some.

Steve Hiscock:

So, one of the calls that you are looking at is just how long this sort of cycle will take and the way, these are very clever companies that have very deep research teams and they’re positioning themselves for the next 10, 20 years, aren’t they?

Stephen Gorenstein:

Yeah, that’s correct. That’s correct.

They’re not looking at what we look at in the very short term. They’re looking at much longer term and they’re seeing the thematics clearly playing out, and copper is a preferred commodity of theirs. And as it happens, it’s a preferred commodity of ours as well.

Steve Hiscock:

Okay, great. Thank you. Let’s look at the three biggest drivers of commodity markets right now.

So, I don’t know what you think they are, macro, geopolitical, supply, demand and so forth. But what are the three biggest drivers as you see them, and what matters to you most at the moment?

Stephen Gorenstein:

Look, in terms of the drivers that we’re seeing at the moment, I think we need to differentiate between short term and long term.

Right now, the markets are very focused on the short term. To kick off 2026, what we saw is the energy within the Resources sector continuing to run. But this time it was on steroids. In January alone, we saw the rally become a lot more widespread and no longer commodity specific. For example, both lithium and nickel bounce very strongly in the early part of the year, in the first month of the year.

And even though in our view, both of them remain structurally in oversupply. In our preferred commodities, for example, gold and silver the moves have been particularly strong from 31 December to 28. January gold rose from 4320 an ounce to 5,600 an ounce, a 30% increase, while silver actually jumped from $70 to 120, 70% up.

In other words, things probably got a bit ahead of themselves. Then late last week, President Trump announced a new Fed share, which caused the market to worry about the appointee might be too hawkish and less willing to cut interest rates as quickly as previously expected. That shift in expectations caused markets to react sharply over the past few days, while that correction in resources markets over the last few sessions was very sharp and is continuing to be very sharp. It’s important to put it in context. Despite the recent falls in gold and silver, both commodities are still up for the year, about 8%. That’s not a bad start to the year by any measure. For us, we feel that the theme of cutting interest rate cycles is very much intact.

Despite the market concerns around the new Fed chair. We believe interest rates are set to climb further this year for two key reasons. First, President Trump would not have appointed Warsh if he did not think he would continue to cut rates. And secondly, in the end, data will determine the direction of Fed policy.

The Federal Reserve has two clear mandates, jobs and inflation. With employment being the much more important of the two. As long as job numbers remain weak at which we expect they will, interest rates are going to continue to be cut. Longer term, the key theme to focus on is supply and demand. As you mentioned Steve, and from that perspective, when you look at all the things going on in the world from a weaponization perspective, from an electrification perspective, we feel that commodities are set for a very good run.

Steve Hiscock:

So I guess on that basis, I’ve got a two-part question for you. And the benefit of that is that you might even forget the second part of the question by the time I’ve asked it, but no, but they’re interrelated. It’s been suggested that we are at the start of a long term super cycle, if you like, for commodities. And you’ve pointed to this with the electrification and so forth. Therefore, the argument is from an investor point of view, it is actually essential to have an exposure to this area as part of your diversified portfolio.

So firstly, can you comment on the long-term super cycle theory and then secondly, and this is more short term I guess, but after such a strong rise over 2025, acknowledging there has been a pullback in January what’s your view over the next 12 months as opposed to say a more, a very positive long term view, I’m presuming?

Stephen Gorenstein:

Sure. Look, Steve, people are obviously starting to talk about super cycles. And from our point of view, we do not disagree with that theme. But we do think this one is a little bit different to other super cycles. And I’ll explain what I mean. In my lifetime, prior to the current situation, I’ve lived through two major commodity price booms.

The first was in the seventies when Japan set out to become the steel barons of the world. They did this by joint venturing as many coal mines as they possibly could, and underwriting all the iron ore infrastructure that we see in the Pilbara today. When you break that down and look at what they were actually doing, they were effectively nationalizing resources.

The second was in the 2000’s, and that was driven by China. China wanted to control as much of the global commodity complex as it possibly could. They brought mines everywhere that they possibly could here in Australia, across Africa and the rest of the world. They acquired raw materials and downstream products to ensure they had maximum control over supply.

Again, if you strip it back and think about what were they actually doing, they were nationalizing resources. Now, if you fast forward to what we’re seeing today, the US has realized for the past 30 years they’ve been behind the eight ball. They do not have sufficient access to the critical minerals that they need.

And when we talk about critical minerals we’re talking about things required from military capability, energy, security and technology, right? You can’t make bullets without this stuff. You can’t make armor without this stuff. These are a key for national security.

As a result, what the US is now trying to do is trying to unwind that vulnerability. They’re trying to do this by ensuring access to critical minerals across friendly jurisdictions from here in Australia to the US themselves, to Greenland and beyond. The objective is clear to regain control over their own destiny and when it comes to their critical mineral supply. That process is creating the next phase of resource nationalization and in our view, the next super cycle, as you point out. But what’s different this time is it won’t be as broad based as it was in previous cycles. This is not like the 2000’s when virtually every commodity ran.

We think this cycle will be far more selective. Investors will need to be much more specific about which commodities they’re going to be exposed to, and just as importantly which ones they’re going to avoid.

Steve Hiscock:

And I guess the second part of the question, so that, that’s the longer-term side. The shorter-term side, what’s your view there?

Stephen Gorenstein:

Look in, in short term, we feel that what’s happening in markets right at the moment with the sell down over the last few days, we think that is very much just noise.

Steve Hiscock:

Right.

Stephen Gorenstein:

We are very comfortable where things are sitting and we’re also very comfortable where commodity prices are, even though they’ve fallen quite significantly.

As I mentioned earlier, they got ahead of themselves and, they’re now in a very comfortable situation, going up eight to 10% in a month. There’s nothing wrong with that at all.

Steve Hiscock:

And just look, drilling down to a specific one, which has been the subject of a lot of attention over the past few years, has been lithium.

So you are saying that it’s in oversupply. So does that mean, is it like a long term thing? Is it a short term thing? There’s lithium ETFs and all that sort of thing. And obviously it’s connected to batteries and everyone’s expecting that to run out, but why do you think lithium is where it is?

Stephen Gorenstein:

When you look at lithium, there’s two parts of it. Obviously, demand and supply. And from a supply perspective, that’s the first thing I focus on. And if you look at what happened in WA when the lithium boom started, what you saw was lithium production double within two years. Alright? Yes, it wasn’t off the highest base, but it doubled within two years.

It’s not a hard commodity to find and it’s not a hard commodity to bring online. Alright, so that, that’s the first point I’d raise. The second thing I’d say is you are also seeing some thrifting out of lithium within the battery complex. That’s not complete. And I’m not suggesting for a second that lithium demand is not going to grow.

It will grow.

Steve Hiscock:

Sorry, what do you mean by?

Stephen Gorenstein:

Thrifting? Substitution.

Steve Hiscock:

Right.

Stephen Gorenstein:

So, you’re seeing some thrifting away from it. That doesn’t mean I don’t suggest lithium demand will grow. I do think it will grow and that won’t change anytime soon. I just think supply, if you think about lithium, one thing you should notice, if you remember your year 10 chemistry, Steve is its number three on the periodic table, which means it’s incredibly abundant within the Earth’s crust. There’s no shortage of it.

Steve Hiscock:

It is quite a while since I read my periodic table, but thanks for that. Okay, let’s get to you and your portfolio then. So you run the portfolio here, the Ari fund. Now the Ari fund for our listeners, is a specialized long only fund, and its sole focus is on listed global resource investments.

And I’ll have to say, your performance has been extraordinary. You’ve returned roughly 95% after fees in the last calendar year, 95% is put you in the top 0.1% of all fund returns. Fantastic. First of all, congratulations. But can you go through the key drivers of what drove that performance?

Stephen Gorenstein:

Yeah, sure. No, thanks Steve. It was, 2025 was obviously a good year and, it was very enjoyable. And we look at the returns over that year, and the market obviously started moving in our favor from about April onwards. And, prior to that it had been very much a stock selective market which we think we had done quite well on. We outperformed the resources index very strongly in the two years previous since we took over the fund’s management. But last year obviously was, I won’t lie, it was a lot more fun when we weren’t fighting, swimming uphill basically. So yes, it was better.

The key themes that drove, that was making sure we were positioned in the right commodities. And as you pointed out, when we first came in and took over the fund, one of the first key things we kept hearing about was we had to be in lithium.

Every single broker, everyone we would talk to was telling us we had to be in lithium. We did analysis on lithium and came up with a different view, and instead, at the time we actually went and looked at the gold market at the time, which we were favorable to. You put in a bit of context.

When we took over the funds, the gold price in Australian dollar terms with was. $3,100 an ounce, which today sounds really low, but in reality, it was. I looked at that and I said, if you can’t make money at $3,100 an ounce, there’s something wrong with you. Alright. That is a great price for gold.

The fact that it’s more than doubled since then is actually not even relevant. It just goes to show how good the margins have become. So, we went very long gold when no one wanted to talk about it and we went short lithium. That was the first key trade we made. And that together with copper and the critical mineral’s theme all played out really nicely in the 2025 year, so that they were the key drivers.

Steve Hiscock:

Okay. And I guess that brings us to the future then. So looking forward. What you’re saying is this is not a normal supercycle for commodities. This is going to be very specific. So, the actual choice of commodity is probably as important as it’s ever been in terms of choosing the right resource company.

So how have you positioned the fund going forward?

Stephen Gorenstein:

Yeah, that is exactly right in our view Steve, so you’re spot on. The way we think about our portfolio is initially very much top down and then bottom up. So, we take both approaches. We spent a lot of time analyzing the commodity markets and determining which commodities we want to be in and which ones we want to avoid.

As mentioned earlier, we’re very favorable to gold, copper, silver, uranium, and critical minerals. They’re the key ones that we’ve positioned the fund for and we’ll continue with that theme. Once we’ve that decision, then we move into the bottom up mode, and that’s where the next layer of work comes.

And so when we are making a core position, we do have a core and a tail position and we are happy to take smaller positions in some exposures just to get a taste of it. But when we’re taking a core position, we do an incredible amount of work spending a lot of time with management modeling the companies, doing competitor analysis, et cetera, et cetera. And we spend a lot of time. And then the last filter that we make sure we put through is we’ve got a very good network between ourselves and our advisory board, a network of people that we that we know throughout the industry.

And we make sure we haven’t missed any key things that potentially could trip us up using those networks.

Steve Hiscock:

Terrific. And Steve. Thank you again for giving us your time. Congratulations again for a terrific return and good luck for this year going forward.

That brings us to the end of today’s podcast.

We looked at what happened in an incredible year for commodities or some commodities. And then Steve ran us through what it means for investors going forward. Before that, we had Rob chat to us about the macro side, and that was really insightful. Again, unpredictability, volatility is certainly gonna stay around and, for the short term.

We hope you enjoyed today’s episode. Please subscribe so you don’t miss out on future podcasts and follow us on LinkedIn, YouTube, Spotify, apple, or wherever you get your podcast from. Please also let us know if you have any questions or comments. And until next time, stay informed and stay active.