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September 2009 Newsletter

September 1st, 2009

CANADIAN ADVANTAGE FUND

The Canadian Fund finished the summer on a strong note, rising 2.94% while the S&P; TSX Index ended almost flat, up 0.75%. That caps off the Fund’s sixth straight monthly gain, helping us produce a 92% gain year to date, which coincidentally is the best return in Canada for a Canadian equity fund (Globefund, Morningstar). Strength from a few select energy, material, and industrial companies this month helped us edge out the relatively quiet TSX Index. The best performers last month were infrastructure company Aecon Group (9.0%) and oil service company Calfrac Well Services (10.7%).The market continues to build confidence in a more stable economy that is being helped by postponed consumption, rebuilding of inventories, and government stimulus. Most of this was confirmed with the first monthly increase of Canadian GDP in ten months. As the economy levels off, we are looking towards the economic landscape in 2010 and the opportunities that offer the best prospects for growth at a reasonable price.

WORLD ADVANTAGE FUND

The World Fund had a great couple of months over the summer, adding to July’s gain with a 4.39% return in August while the MSCI World Index ($C) rose 5.61%. Not to outshine the Canadian Fund, but the World Fund has been standing out on its own with a 12 month return of 39.13%, making it the best Global equity fund and one of the top five Canadian mutual funds during that period (Globefund, 12 months ending July 31st). Our European holdings were the biggest gainers last month as economic data was much more positive than expected with demand from Asia helping the region. The biggest winner’s were Danish shipper A P Moller – Maersk (15.1%) and German steel maker ThyssenKrupp (9.5%). Last year we witnessed the synchronized global recession, which has been transformed into the global synchronized recovery. The recovery stills remains lumpy with Asia faring better than developed western nations. From our standpoint, there is a plethora of opportunities and options available to us across the globe, regardless of the shape of the recovery; hence, we continue to see the World Fund building on its success as we approach the second decade of the 21st century.

Van Arbor Asset Management is an independent Asset Management company dedicated to creating wealth using a disciplined, proprietary investment strategy with an emphasis on preserving capital while generating superior long-term returns.

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