JC Clark Adaly Fund November 2014 December 1, 2014 Dear Investor, The JC Clark Adaly Fund's net asset value (NAV) increased by approximately 1.5% per unit in November, bringing year-to-date (YTD) performance to an increase of roughly 52%. (Results vary slightly by Class, due to differing fee structures). Individual client statements will be mailed shortly, but in the meantime, the most widely held Class A and Class B units had month-end NAV's of $8,587.10 and $2,722.88, respectively. The most notable event of the past month was the stunning collapse in the price of oil - down $17 or 20%. From its high just six months ago, oil is down almost 40%. As a result, energy stocks have been decimated. The TSX Energy Index ETF (XEG) has dropped 32%, but most junior energy names are off far worse than that. The Adaly Fund has been largely devoid of oil & gas companies this year. Until September, it didn't own a single oil producer - just two small positions in a natural gas-weighted junior, and a U.S. oil service company. In the past three months, we have edged our way into a few more names, and as of end-November had roughly a 10% weight in five stocks with direct (or indirect) exposure to oil prices. However, the sell-off in the last week of the month did reduce the Fund’s overall return. Otherwise, our core positions continued to perform well. Long-time holdings like Amaya, Concordia Healthcare, Currency Exchange and Counsel Corp. all moved up on the back of excellent financial results. Small cap positions Terra Firma (a specialty real estate lender) and Patient Home Monitoring (the name adequately describes the business) had particularly big moves (each up 35%). The only other material impact on performance was our hedges, or ETF shorts, which went against us as the U.S. market in particular continued to move higher. Lower oil prices are viewed as a major benefit to the consumer, which is a much larger piece of the U.S. economy than the domestic energy industry. As we enter the last month of the year, we are optimistic and see continued good returns. Most of the companies in our portfolio have important catalysts awaiting them in 2015. Their timing is unpredictable, but when they hit, the impact on share prices should be significant. Regards, Martin Braun
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