| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 11.4% | -0.9% | -0.9% |
VELA International Fund declined 0.90% in Q1 2026, matching the MSCI World Ex-US Index amid geopolitical turmoil. The quarter saw initial gains through February before the Iran war commenced February 28, leading to Strait of Hormuz blockade affecting 20% of global energy supplies. Energy holdings TotalEnergies and Suncor led performance on higher energy prices, while gold miner Alamos Gold benefited from continued precious metals strength. The manager sold three positions including top performer OceanaGold as valuations approached fair value, and added four new holdings including luxury fragrance company Interparfums SA, UK insurer Sabre Insurance, travel company Jet2, and Universal Music Group. Cash position of 8.4% provided first quarterly benefit after four quarters of equity gains. Manager plans to reduce cash going forward, trusting stock selection over market timing. Despite ongoing macro uncertainties including Federal Reserve independence concerns and tariff policy changes, the current chaotic environment is viewed as ideal for deploying capital into attractively valued individual opportunities.
Value-oriented international equity strategy focused on companies trading at significant discounts to intrinsic value with long-term holding periods, while incorporating macro factors and geopolitical developments into investment decisions.
Manager views current environment as ideal for deploying additional cash despite ongoing geopolitical chaos. Plans to reduce cash position and trust stock selection to beat market. Continues monitoring macro factors while focusing on building portfolio of attractive individual investment ideas trading at discount to intrinsic value for long-term holding.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Apr 21 2026 | 2026 Q1 | ABEV, ABF.L, AGI, ALLFG.L, ARCO, BAKKA.OL, DUE.DE, GLOB, GRG.L, HIK.L, IPAR, ITP.PA, JET2.L, NOMD, OGC.TO, SBRE.L, SU, TTE, UMG.AS, UNTR.JK, WIE.VI | energy, Geopolitical, gold, international, Luxury, Travel, value | - | International value manager navigated geopolitical chaos in Q1 2026 with energy and gold holdings driving performance amid Iran war. Sold top performer OceanaGold at fair value, added four new positions including luxury fragrance and travel companies. Plans to deploy 8.4% cash position into attractive individual opportunities despite ongoing macro uncertainties. |
| Oct 1 2025 | 2025 Q3 | AGI.TO, ALLFG.L, ARCO, ARGX, BAP.AX, COA.L, FEVR.L, FIE.DE, FUC.DE, GLOB, HIK.L, IFX.DE, INDV.L, JEL.HK, KRKA.L, NOMD.L, OGC, SRP.L, TECN.SW, WIE.VI | Cash, gold, healthcare, international, tariffs, value |
HIK LN TECN SW FEVR LN COA LN GLOB |
VELA International outperformed in Q3 with 7.43% returns while maintaining 9.5% defensive cash position. Added healthcare and consumer names at attractive valuations amid tariff uncertainty. Gold miners continue strong performance as insurance against systemic risks from potential Fed independence threats and record debt levels. Manager remains selective and disciplined given unresolved global policy uncertainties. |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2026 Q1 |
EnergyEnergy prices shot higher following the Iran war and Strait of Hormuz blockade affecting 20% of world energy needs. TotalEnergies and Suncor Energy led portfolio performance on stronger energy pricing. Valuations on energy names becoming stretched, with trimming potentially necessary. |
Oil Natural Gas Energy Trading Geopolitical |
GoldGold appreciated 49% over the last year and 106% over two years. Alamos Gold continued strong performance on better earnings and continued gold price strength. OceanaGold was sold as discount to intrinsic value narrowed and stock became proxy for gold price. |
Gold Gold Miners Precious Metals | |
GeopoliticalWar in Iran commenced February 28 with joint Israeli and U.S. strikes leading to Strait of Hormuz blockade. Primary, secondary, and tertiary effects just beginning to unfold. Current environment ideal for putting additional cash to work given ongoing chaos. |
Iran Middle East Sanctions Trade Policy | |
LuxuryAdded Interparfums SA, a luxury fragrance company that carved unique niche producing and marketing perfumes for global luxury brands. Stock fell back to 2019 levels despite revenues nearly doubling between 2019-2025, creating attractive valuation opportunity. |
Luxury Beauty Consumer Discretionary | |
TravelAdded Jet2 Plc, a packaged holiday and airline business with phenomenal execution and double-digit returns on capital. Trades at substantial discount to intrinsic value over next ten years, though Middle East conflict could affect jet fuel prices. |
Airlines Travel Leisure | |
| 2025 Q3 |
GoldGold serves as insurance against credit destruction and declining confidence in financial authorities. Current environment supports gold due to high US debt levels, potential Federal Reserve independence threats, and geopolitical tensions from Russia sanctions. Gold miners provide leveraged exposure with focus on low-risk jurisdictions and organic growth. |
Gold Miners Monetary Metal Insurance Credit Confidence |
Trade PolicyTariff implementation remains unsettled with consensus around full effects hitting in 2026. Uncertainty around tariff rates and legality creates planning difficulties for businesses. This breaks 40-year free trade paradigm and represents direct challenge to globalization. |
Tariffs Globalization Uncertainty Planning | |
PharmaceuticalsAdded Hikma Pharmaceuticals for contract manufacturing capacity to help foreign companies avoid tariffs through domestic production. Tecan Group offers laboratory automation exposure at significant discount due to temporary headwinds including Chinese order weakness and research defunding. |
Contract Manufacturing Laboratory Automation Tariff Avoidance |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Oct 1, 2025 | Fund Letters | Bob Sharpe | HIK LN | Hikma Pharmaceuticals PLC | Health Care | Pharmaceuticals | Bull | NYSE | Capacity, Generics, Injectables, Margins, tariffs | Login |
| Oct 1, 2025 | Fund Letters | Bob Sharpe | TECN SW | Tecan Group AG | Health Care | Medical Instruments & Supplies | Bull | Swiss Exchange | Automation, lifesciences, R&D, recovery, valuation | Login |
| Oct 1, 2025 | Fund Letters | Bob Sharpe | FEVR LN | Fever-Tree Drinks PLC | Consumer Staples | Soft Drinks | Bull | NYSE | Beverages, Branding, Distribution, Margins, recovery | Login |
| Oct 1, 2025 | Fund Letters | Bob Sharpe | COA LN | Coats Group PLC | Materials | Apparel, Footwear Components | Bull | NYSE | Footwear, Integration, Margins, scale, Textiles | Login |
| Oct 1, 2025 | Fund Letters | Bob Sharpe | GLOB | Globant S.A. | Information Technology | IT Consulting & Other Services | Bull | NYSE | AI, Digital, Itservices, transformation, valuation | Login |
| TICKER | COMMENTARY |
|---|---|
| TTE | TotalEnergies (Energy) led the way in the quarter on stronger energy products pricing, especially after war in Iran broke out. Valuations on energy names are becoming stretched, trimming of positions may be necessary. |
| SU | Suncor Energy (Energy) led the way in the quarter on stronger energy products pricing, especially after war in Iran broke out. Valuations on energy names are becoming stretched, trimming of positions may be necessary. |
| AGI | Alamos Gold (Materials) continued its strong performance on the back of better fourth quarter earnings results and the continued strength in gold prices. Strong earnings comparisons should continue into 2026. |
| ABEV | Ambev (Consumer Staples), the Brazilian brewer reported better than expected revenue growth and market share recovery at the end of a difficult 2025. Strong premium brand volumes helped buoy results at yearend. Ambev remains one of the most inexpensive brewers in the world. |
| OGC.TO | We sold OceanaGold, the Canadian gold miner, just as the war broke out in Iran and before the gold price rolled over. The major reason for the sale was the anticipated decline in gold production in 2027 and beyond. This holding has been the single best investment since the inception of the Fund, but the discount to our estimate of intrinsic value narrowed to the point that the stock price was just a proxy of the gold price. |
| NOMD | Nomad Foods (Consumer Staples) reported sub-par earnings results and guided lower on the 2026 outlooks which led to a step down in the company's stock prices. Nomad hired a new CEO to correct some self-inflicted decisions (i.e., too aggressive price increases) which led to market share losses. The company trades at a significant discount to our estimates of fair value. |
| ABF.L | Associated British Foods (ABF, Consumer Discretionary) reported sub-par earnings results and guided lower on the 2026 outlooks which led to a step down in the company's stock prices. ABF's Primark division, the fast fashion apparel retailer, guided margins down for fiscal year 2026. The company is conducting a strategic review to determine if Primark and its Food business should be separately listed. Both companies trade at a significant discount to our estimates of fair value and the latter, should it split in two, could also see an additional valuation uplift. |
| WIE.VI | Wienerberger (Materials) is a cyclical company whose prospects tend to move with economic growth declined at the outbreak of hostilities in the Middle East as the equity market discounted slower future growth. Before the conflict, the holding was already attractively valued. |
| DUE.DE | Duerr (Industrials) is a cyclical company whose prospects tend to move with economic growth declined at the outbreak of hostilities in the Middle East as the equity market discounted slower future growth. Before the conflict, the holding was already attractively valued. |
| GLOB | Globant, the information technology (IT) service company, saw the market further discount a perceived risk, disruption from artificial intelligence (AI) in the IT service business. This is not new, just a further extension of an existing trend which we feel the market has sufficiently discounted. |
| SBRE.L | We added Sabre Insurance, the UK non-standard underwriter of motorist (auto) insurance. Sabre has experience and an extensive database which allows them to price the policy appropriately (at a premium) and its success over time has led to high returns on capital. The current UK motorist insurance cycle is sitting at a bottom with the company priced for no growth with the conditions for a cycle upturn showing green shoots. While we wait for the turn, the company pays out 90% of its earnings in dividends which carried a 9% yield at purchase. |
| ARCO | Arcos Dorados, the Brazilian quick service restaurant franchisor appreciated during the quarter. Arcos reported strong sales and operating cash flow growth with good margin expansion, giving encouraging signs that the South American consumers may be finally coming out of a slump. |
| HIK.L | Hikma Pharmaceuticals, the UK specialty generic company reduced guidance for 2026 and withdrew its medium-term guidance acknowledging recent execution missteps. The company outlined a high-level improvement plan to restore stability and drive sustainable long-term growth. The stock price of Hikma sits at historic lows on a variety of valuation parameters which entirely ignore its solid Branded business and a more realistic margin structure in the Injectables segment. |
| ALLFG.L | We sold our position in Allfunds Group following the announced definitive takeover bid from Deutsche Boerse this January (preliminary offer in late November). We purchased Allfunds in August last year, and the sale created a short-term gain which we intend to offset with a short-term loss in the remainder of the year. |
| UNTR.JK | We sold United Tractors, the Indonesian heavy-equipment distributor, coal producer, and gold mining player, following a government announcement revoking the gold mining permit for the company's largest gold mine. President Subianto has been less laissez-faire than his predecessor with the business community, which makes us less comfortable with holdings in this emerging market country. The investment has added value over our holding period, generating large dividend payments with cumulative payouts exceeding over half our original cost basis. |
| ITP.PA | We added Interparfums SA, a Paris-based luxury fragrance company which is 72% owned by its US-based parent, Interparfums Inc. These companies have carved out a unique niche focusing solely on perfumes, which they produce and market for a variety of global luxury brands. The founders are still actively involved in the business, which has historically generated high returns on capital. Like many COVID beneficiaries, the stock peaked in early 2023 before falling back to levels seen in 2019 as growth declined and inventories became bloated. Between 2019 and 2025, revenues nearly doubled, operating profit and net income more than doubled, and the price/earnings multiple fell by 65%. Those adjustments are now behind the company, and it trades comfortably below our estimate of intrinsic value. |
| JET2.L | We added Jet2 Plc, a packaged holiday and airline business operating across 13 bases in the UK and flying to over 75 destinations in Europe. Besides the airline, the rest of the operation is asset lite. They have done extensive research to identify desirable hotels and resorts to which they incorporate into a holiday package. Execution has been phenomenal, with returns on capital at double digit levels apart from the pandemic period. We have taken an initial position in the company given the substantial discount to our estimate of intrinsic value over the next ten years. There remain some near-term catalysts, but the current Middle East conflict could negatively affect the price of jet fuel and/or its availability which calls for a smaller sized initial holding. |
| UMG.AS | We added Universal Music Group, the Dutch based entertainment company which produces and distributes music content globally. It is the largest holder of music intellectual property, with scale, and helping to fuel the growing music streaming market. Music streaming remains one of the best deals in entertainment and is the one service that has not seen repeated price increases. Streaming companies like Spotify or Amazon have deals with Universal that contain escalators should the streamers increase the monthly rate they charge to subscribers; a portion of the increase will flow through to Universal. The company has been a desirable asset since listing in 2021; however, we could never make the valuation work with the average trailing P/E multiple through mid-2025 sitting at 40 times. Since mid-year 2025, the stock price fell 45% and brought the average trailing P/E multiple down below 20x (to 16x at purchase), a level much more to our liking and working in a more comfortable margin of safety. |
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