| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 20.8% | - | 22.7% |
| 2025 | 2024 | 2023 | 2022 | 2021 | 2020 |
|---|---|---|---|---|---|
| 22.7% | 22.1% | 42.6% | -53.0% | -23.7% | 52.1% |
Hirschmann Capital delivered exceptional returns in H2 2025, with Class A and Class B returning 63.2% and 67.3% respectively versus 11.9% for the S&P 500, demonstrating the effectiveness of their ultra-bearish strategy focused on gold mining equities. The manager argues that a US sovereign debt crisis is inevitable, noting that all 55 net debtor countries with debt exceeding 120% of GDP have historically defaulted, and the US has already crossed this critical threshold. Gold allocations have reached their highest levels since 1979-81, reflecting rational concern about sovereign default risk via inflation. The Fund's gold mining equities remain attractively valued with minimal debt and low production costs, positioned to benefit from both rising gold prices and operational progress as projects advance from development to production. While other bearish strategies like equity shorts offer potential upside, they carry unlimited downside risk and adverse characteristics. The manager expects GMEs to more than triple over the next few years as they converge with intrinsic values, providing superior risk-adjusted returns in an environment of elevated sovereign credit stress.
The Fund maintains an ultra-bearish strategy focused on gold mining equities as the optimal hedge against an inevitable US sovereign debt crisis, positioning for significant outperformance as gold prices rise and mining projects advance to production.
The manager expects gold mining equities to more than triple over the next few years as they converge with intrinsic values, supported by minimal debt and low production costs. A sovereign debt crisis is viewed as extremely likely, which should benefit gold allocations and the Fund's positioning.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jan 30 2026 | 2025 Q4 | - | Bearish, Crisis, Default, gold, inflation, Mining, sovereign debt, Valuations | - | Gold allocations reached their highest level since 1979-81, a rational response to the high probability of a USG default via inflation. The Fund's GMEs remain far more attractive than gold bullion due to their low valuations and fixed costs. If gold continues to rise, the Fund's GMEs should continue to outperform by a wide margin. The Fund's gold mining equities appreciated following positive feasibility studies, new management securing relationships, prioritizing permitted projects, record production, and acquisition activity. GMEs should more than triple over the next few years as they converge with their intrinsic values, cushioned by minimal debt and low production costs. Since 1825, all 55 net debtor countries with gross government debt exceeding 120% of GDP ultimately defaulted through restructuring, devaluation, high inflation, or outright nonpayment. The US has already crossed the critical 120% threshold and should be far beyond it after the next recession. The probability of a sovereign debt crisis is extremely high, with the US government effectively defaulting via high inflation similar to 1980. Gold allocations have historically risen during periods of heightened concern about sovereign default, whether outright or via inflation. |
| Oct 30 2025 | 2025 Q3 | - | Bear Market, gold, inflation, monetary policy, Precious Metals | NEM | The funds ultra-bearish strategy continued to outperform as gold equities surged over 130% year-to-date, reflecting rising concerns over U.S. debt and inflation. Management reiterated that gold remains deeply undervalued and should benefit when the U.S. superbubble bursts. The letter emphasized gold miners as key beneficiaries of monetary debasement and macro instability. |
| Jul 29 2025 | 2025 Q2 | - | Debt crisis, gold, inflation hedge, mining equities, Safe haven | - | The letter presents gold and gold mining equities as underappreciated protection against an impending inflationary and debt-driven crisis. Management argues that extreme valuations in U.S. equities and bonds increase the appeal of gold as financial insurance. Volatility is framed as an opportunity to accumulate gold assets below intrinsic value. |
| Apr 4 2025 | 2025 Q1 | - | - | - | |
| Jan 31 2025 | 2024 Q4 | - | - | - | |
| Jul 26 2024 | 2024 Q2 | - | - | - | |
| Jun 7 2024 | 2024 Q1 | - | - | - | |
| Jan 30 2024 | 2023 Q4 | - | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2025 Q4 |
Credit StressThe fund is responding to historically low credit spreads by reducing exposure to high yield and other lower-rated debt. They believe current spreads offer insufficient compensation for credit risk and increase the risk of permanent impairment of capital. The managers are downside-focused and do not share the market's optimism needed to justify such low spreads. |
Credit spreads High yield Credit risk Permanent impairment Risk compensation |
GoldGold returned +65% in dollars in 2025, driven by broadening demand from central banks, professional and retail investors. Central banks now hold 24% of reserves in gold versus 23% in US Treasuries for the first time. Maintained 12% portfolio allocation throughout the year. |
Central Banks Reserves Diversification Demand | |
Gold MinersMultiple gold mining companies delivered strong performance with several high-grade discoveries and resource expansions. Companies like Spanish Mountain Gold, Endurance Gold, and Omai Gold reported significant drill results and resource growth potential. |
Gold Mining Exploration Resources High-grade | |
InflationInflation has continued to be a persistent feature in Japan and has prompted changes in both corporate and consumer behavior. Importantly, inflation has fed through to corporate earnings and equity performance. Companies that have successfully passed on higher costs to consumers have benefited from improved operating margins. |
Inflation Corporate Earnings Operating Margins Consumer Behavior Cost Pass-through | |
| 2025 Q3 |
GoldGold returned +65% in dollars in 2025, driven by broadening demand from central banks, professional and retail investors. Central banks now hold 24% of reserves in gold versus 23% in US Treasuries for the first time. Maintained 12% portfolio allocation throughout the year. |
Central Banks Reserves Diversification Demand |
InflationInflation has continued to be a persistent feature in Japan and has prompted changes in both corporate and consumer behavior. Importantly, inflation has fed through to corporate earnings and equity performance. Companies that have successfully passed on higher costs to consumers have benefited from improved operating margins. |
Inflation Corporate Earnings Operating Margins Consumer Behavior Cost Pass-through | |
| 2025 Q2 |
GoldGold returned +65% in dollars in 2025, driven by broadening demand from central banks, professional and retail investors. Central banks now hold 24% of reserves in gold versus 23% in US Treasuries for the first time. Maintained 12% portfolio allocation throughout the year. |
Central Banks Reserves Diversification Demand |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Oct 30, 2025 | Fund Letters | Brian Hirschmann | NEM | NEW Gold Mining Equities | Materials | Precious Metals & Mining | Bull | NYSE | Commodities, Gold, Hedge, inflation, Macro, Mining, valuation | Login |
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