Monthly Message

The Wutherich & Co. Composite was up 2.7% in August. This compares with the S&P/TSX down 0.8% and the BMO Small Cap Index up 0.8%.

The Organic, Gluten Free Portfolio

A friend’s parents have a farm near Ottawa. They have a small woodlot on their property and sell firewood from felled trees. A neighbor, who does the same thing, decided to put up a sign on the road saying that he was selling “organic firewood”. He rapidly sold out of inventory though his practices were no different than any of his neighbors’. It is hard to imagine anyone using pesticides or fertilizer or anything else that would be “unorganic” on their woodlot. Branding made all the difference.

I recently saw a label declaring that a bottle of water was gluten free. Can a wheat protein end up in a bottle of purified water? I suppose the water producer is glomming-on to the gluten free craze that has swept the food industry in the last few years.

As for the Wutherich & Co. Portfolio, we mentioned last month that we were number one in the Pavilion survey of small-cap Canadian investment managers for the year to June. Morningstar publishes numbers for small-to-mid cap Canadian managers. While this sample set is different than Pavilion’s and may not be considered comparable, we would like to point out that, for the year ended August, their top ranked fund posted 24.1% versus our after-fee number of 26.3%.

We think our long-term numbers are excellent and this is what we manage to. However, we haven’t received much recognition for our recent performance, so we are thinking about rebranding our product the Organic, Gluten Free Portfolio. What do you think?

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