| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | 5.5% | 15.8% |
| 2025 |
|---|
| 18.3% |
Jemekk Hedge Fund delivered strong performance in Q4 2025 with an 18.3% annual return, positioning to benefit from Canadian outperformance versus US markets for the first time since 2022. The fund's thesis centers on Canada's competitive advantages in oil, gold, and financials, combined with a government pivot toward growth and deregulation representing a significant shift from the previous restrictive decade. Key contributors included energy holdings like MEG and CNQ, precious metals producers focused on silver, and financials including Goldman Sachs and Fairfax Financial. The managers are particularly excited about Build Canada themes, with holdings like Exchange Income Fund positioned to capitalize on infrastructure development in Canada's North and elevated defense spending globally. RTX Corporation provides exposure to the defense re-rating as countries commit to higher NATO spending targets. The fund maintains an 85% net long position, higher than historical levels, while remaining hedged against macro risks including persistent inflation, tariffs, and potential labor market weakness. Looking ahead, the managers expect continued Canadian outperformance and above-average returns in 2026, though not matching 2025's exceptional performance.
The fund is positioned to capitalize on Canadian outperformance driven by the country's strong fundamentals in oil, gold, and financials, combined with a new government approach focused on growth and deregulation, while also benefiting from elevated defense spending globally and Build Canada infrastructure themes.
The managers expect 2026 to produce above average returns although not to the extent of 2025. They believe Canada has a lot of catch up to play with mid teen multiples and should begin to get increasing fund flows both domestically and globally as investors seek to capitalize on the resource theme and the recent pivot to Build Canada. They remain constructive but cautious given the extended run and expected volatility as mid-term elections approach.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jan 14 2026 | 2025 Q4 | CNQ.TO, EIF.TO, FFH.TO, GS, MEG.TO, RTX | aerospace, Canada, commodities, defense, energy, infrastructure, Precious Metals, Resources | RTX | The fund is positioned to benefit from elevated defense spending driven by rising defense budgets in the U.S. and allied countries. Growth is underpinned by demand for integrated air and missile defense systems, counter-drone technologies, and other advanced defense programs driven by geopolitical tensions. The entire Defense Prime complex is currently re-rating as countries around the world are committing to spend more on defense initiatives. Energy was a significant contributor to fund performance, with specific mentions of MEG takeover and CNQ performance. The fund sees Canada as having a strong preponderance of Oil (power) as part of its competitive advantages. Energy represents one of the key sectors driving Canadian outperformance versus the US markets. Precious metals provided solid contributions within the quarter through a basket of producers, primarily silver. Gold is viewed as the real store of value, and precious metals represent one of Canada's key competitive advantages. The fund entered Q4 2025 with precious metals as their largest sector allocation. The fund is positioned to capitalize on Build Canada themes, particularly through companies that can provide solutions for building out Canada's North including energy, critical minerals, and transmission/power infrastructure. This represents a pivot toward nation building and infrastructure development that should benefit portfolio companies. The fund expects continued Canadian outperformance driven by strong fundamentals in oil, gold, and financials, combined with a new government approach focused on growth and deregulation. Canada is signaling to the world that it is finally back and open for business, representing a significant pivot from the restrictive decade of the previous regime. |
| Sep 30 2025 | 2025 Q3 | FFH CN | dislocation, forced selling, liquidity, mispricing, volatility | - | The letter focuses on market dislocations created by forced selling, liquidity shocks, and behavioral overreactions. These periods are viewed as recurring features of markets that allow disciplined investors to buy assets below intrinsic value. The fund positions itself to exploit volatility when price diverges sharply from fundamentals. |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2025 Q4 |
CanadaThe fund expects continued Canadian outperformance driven by strong fundamentals in oil, gold, and financials, combined with a new government approach focused on growth and deregulation. Canada is signaling to the world that it is finally back and open for business, representing a significant pivot from the restrictive decade of the previous regime. |
Canada Outperformance Resources Deregulation Growth |
Defense SpendingThe entire world is rapidly rearming off an extremely low base of defense spending. This exposure focuses on companies that make armaments for nation state security and materially outperformed for the year. |
Defense Armaments Rheinmetall Palantir RTX | |
EnergyEnergy plays a critical role in AI infrastructure economics, with data centers becoming major electricity consumers. Rising power costs compress margins while grid constraints and regulatory scrutiny influence deployment timelines. The manager emphasizes that unlike software-driven growth, AI compute cannot be scaled independently of physical energy reality. |
Data Centers Grid Power Infrastructure Utilities | |
Infrastructure SpendingPlaying on the continued theme of infrastructure spending, defense and energy sustainability, positions in Industrial and Energy sectors including Oshkosh, Coterra, OSI Systems, and Herc Holdings added positively to performance. |
Defense Energy Industrial Government Sustainability | |
Precious MetalsThe precious metals sector experienced dramatic outperformance in 2025, with the FTSE/JSE Precious Metals and Mining index more than tripling. This was the primary driver of South African equity market returns and the main reason for the Hedge Fund's underperformance relative to its benchmark. |
Platinum Mining South Africa Commodities | |
| 2025 Q3 |
Dislocation |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Jan 14, 2026 | Fund Letters | Gerard Ferguson | RTX | RTX Corporation | Industrials | Aerospace & Defense | Bull | New York Stock Exchange | Aerospace, aftermarket, backlog, Defense, Rearmament, visibility | Login |
| TICKER | COMMENTARY |
|---|---|
| CNQ.TO | Energy (MEG takeover, CNQ), Precious metals (a basket of producers, primarily silver) and Financials (Goldman Sachs/Fairfax Financial) all provided solid contributions within the quarter. With the exception of MEG, all remain large holdings, and in some cases, we have further added to our positions. |
| EIF.TO | Exchange Income Fund (EIF) – Not new to us, Exchange Income Fund is a holding company focussed on Aerospace/Aviation and Manufacturing. On the aviation side, EIF maintains strong market share in the North moving people and equipment, in addition to providing surveillance, leasing and service, not only in Canada, but also globally in the UK, the Netherlands and hopefully soon, Australia. On the manufacturing side, EIF is a leading provider of matting solutions (critical in the resource and utility world) in addition to a small window solutions business. EIF is a consistent performer, trading at a low multiple (in our opinion) and is uber focussed on shareholder returns as evidenced by their long history of dividends and intelligent capital allocation (acquisitions). The company is perfectly positioned to capitalize on the Defense and Build Canada themes we have embraced in the portfolio. Providing surveillance solutions has become increasingly important as Canada's North (currently not surveilled) comes under scrutiny and attention from the US (think Greenland) and there are very few, if any other, companies that can provide a solution. Also, the increased focus on building out Canada's North (Energy, Critical Minerals, Transmission/Power) will require massive movement of people and equipment, and there are very few, if any, providers other than EIF. Globally, bidding activity has picked up materially, as nations embrace new NATO spending targets and pivot away from the protection of the US. EIF specifically, although far from a certainty, is bidding on a large ISR (Intelligence, Surveillance, Reconnaissance) contract in Australia (to be awarded in Q1 2026), which if selected will materially impact the company for years to come. We believe EIF has the best bid, however politics may play a big role here, and we would expect some weakness should they not win, an opportunity for us to add further |
| FFH.TO | In the Philippines we hold Ayala Corporation; and we hold Fairfax India. The last of these is a little anomalous in that India is not an undervalued market; we have faith in the ability of Fairfax to invest successfully for the long term. |
| GS | Energy (MEG takeover, CNQ), Precious metals (a basket of producers, primarily silver) and Financials (Goldman Sachs/Fairfax Financial) all provided solid contributions within the quarter. With the exception of MEG, all remain large holdings, and in some cases, we have further added to our positions. |
| MEG.TO | Energy (MEG takeover, CNQ), Precious metals (a basket of producers, primarily silver) and Financials (Goldman Sachs/Fairfax Financial) all provided solid contributions within the quarter. With the exception of MEG, all remain large holdings, and in some cases, we have further added to our positions. |
| RTX | The top three contributors to this outperformance came from RTX (US Defense) |
| Ticker | Put/Call | Amount Bought | Shares Bought | % Change | Weight % |
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| Ticker | Put/Call | Amount Sold | Shares Sold | % Change | Weight % | Status |
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| Industry | Prev Quarter % | Current Quarter % | Change |
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