Client Access 
Communications
Introduction
Hello everyone,
Well, what a quarter we’ve just come through!
First of all, although I had announced my intention to space out these communications due to time constraints, several clients contacted me directly to say how much they appreciate these quarterly newsletters, so I’ve decided to continue releasing them at the same frequency.
Before getting into the heart of the matter, I am pleased to announce that the first annual investors’ meeting in the Montreal region will be held on June 5, at the Club St-Denis. If you don’t receive an invitation in the next few weeks and want to join us, please contact us at info@rivemont.ca and we will be happy to book a spot for you.
In this newsletter, we will explain how we managed to keep our portfolios stable throughout the year as the major equity indexes collapsed. At the same time, we’ll review our investment process to clearly explain the benefits of the active management we advocate. As usual, we will conclude with our market outlook and our largest positions.
One final point: don’t be afraid to check your account balance! And feel free to talk about us to the people around you who haven’t yet had the opportunity to benefit from our effective approach to portfolio management.
Enjoy!
Active management: What guided our decisions
In the first three months of 2025, the equity portion of our portfolios generated a gross return of 5.2%, and that return was 24.1% over the past twelve months. These results are far superior to the indexes and returns earned by traditional, more passive managers.
We applied our investment process rigorously and made three major decisions that led to the happy situation our investors are currently in.
1. Reduce risk and increase cash
Contrary to popular belief, it is neither necessary nor optimal to be fully invested at all times. You need cash to take advantage of opportunities. Furthermore, due to the strong correlation between all risky financial assets, global macroeconomic decisions often have the greatest impact on performance. Finally, given our focus on capital protection, we avoid holding stocks or asset classes that are experiencing a downward trend. To quote the famous saying of Irish writer Samuel Love nearly 200 years ago, “Better safe than sorry.”
2. Avoid U.S. large caps
The so-called “Magnificent Seven” (Amazon, Meta, Microsoft, Alphabet, Apple, nVidia and Tesla) have been responsible for much of the rise in the U.S. equity market over the past decade. All good things come to an end, though, and at the beginning of the year, we sold the last stock standing, Microsoft. We may now be witnessing the end of American exceptionalism, and these companies are a reflection of what’s going well and what’s going badly south of the border.
3. Invest in defensive sectors, including precious metals
We are strong supporters of sectoral rotation in portfolio composition, and we believe that regardless of market conditions, there will be winners and losers. In other words, there will always be interesting opportunities to deploy capital. Over the past 48 months, Rivemont has distinguished itself in the Quebec financial sector as one of the few players to publicly position itself in favour of integrating the gold sector into our portfolios. In fall 2023, at a presentation to several hundred advisors, I said that if the price of an ounce of gold ever exceeded US$2,000, it would be the beginning of a bull market. And that is exactly what happened.
Our portfolios currently hold Wheaton Precious Metals (WPM), Osisko Gold Royalties (OR) and Agnico Eagle Mines (AEM). WPM is up nearly 50% since January 1, providing a tidy performance boost.
During the quarter, we also added securities such as GFL Environmental (GFL) and Chartwell Senior Housing (CSH.UN), which we feel will be less affected by economic conditions and which seem to have been forgotten despite their solid financial performance.
Market Prospects
Favorite Securities
You will find below a list of the individual securities with the largest weight in our portfolios. These stocks were selected based on their respective potential to outperform the market. You will find a short description of their activities, the annual dividend, if any, and the total return since their first inclusion in our portfolio.
Conclusion
While stock markets are inherently unpredictable, we know for certain that their trajectory will not be boring and will always have an impact on the financial health of investors. There will be opportunities, however, and our goal is to identify them as quickly as possible to make the most of them.
Depending on the situation, we favour attack or defence, but most of the time we prefer a combination of the two. The ultimate goal is to optimize performance while minimizing volatility in bearish markets.
Thank you all for your trust,
Martin Lalonde, MBA, CFA
President
