Alma Recurrent Global Natural Resources Fund
Alma Recurrent Global Natural Resources Fund invests primarily in publicly traded equity and debt securities of global natural resource-related companies, operating in a capacity related to the supply, production, distribution, refining, transportation and consumption of natural resources.
The fund’s management is delegated to Recurrent Investment Advisors LLC.
Cumulative Performance (%)
Fund Inception 29 June 2018
The performance data shown represents past performance. Past performance is not a guarantee of future results. Current performance may be lower or higher than the performance quoted. The investment return and the principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost.
Strategy & Manager
Investment objective: the fund seeks total return by investing in global natural resource-related companies.
Typical industries in which the fund invests: energy, basic materials, infrastructure, transportation and logistics
The fund may invest in companies of any market size capitalization, including IPOs
The investment process incorporates macroeconomic and commodity supply/demand factors with fundamental company analysis
Recurrent Investment Advisors is focused on understanding and profiting from commodity cycles to make differentiated natural resource investments
Formed in April 2017. Registered as an investment adviser with the U.S. Securities and Exchange Commission (SEC)
Primarily owned by its co-founders Mark Laskin and Bradley Olsen, who both have extensive experience in finance and energy
Based in Houston, Texas (US)
Mark Laskin, Co-founder and Managing Director
Before founding Recurrent Investment Advisors, Mark was the lead energy portfolio manager and Chief Investment Officer at BP Capital Fund Advisors (BPCFA), an energy-focused long-only investment management firm.
Under Mark’s leadership, BPCFA grew from $50mm to nearly $400mm in assets under management in less than 3 years. BPCFA’s energy strategy was the #1 performing energy open-end mutual fund, as ranked by Morningstar, from 12/31/13 to 12/31/16, and its MLP strategy was in the top decile in its Morningstar category over that same time period.
Mark has 13 years of additional portfolio manager experience at Van Kampen, Morgan Stanley and Invesco. As part of a diversified large cap value strategy, Mark managed more than $10 billion and has managed energy portfolios for more than 12 years. While at Morgan Stanley Investment Management, Mark served as the internal head of equity investment research.
Mark earned an MBA/MA in Finance from the Wharton School of Business at the University of Pennsylvania and a BA in History from Swarthmore College
Brad Olsen, Co-founder and Managing Director
Before founding Recurrent Investment Advisors LLC, Brad was the lead MLP portfolio manager for BP Capital Fund Advisors (BPCFA). Under Brad’s leadership, MLP AUM more than doubled (excluding the impact of appreciation).
From 2011 to 2015, Brad led Midstream Research for Tudor, Pickering, Holt & Co. (TPH & Co.), where he was recognized as the top all-around stock picker in the US by the Financial Times in 2013, and the top energy stock picker in the US by Starmine in 2014.
Brad also has experience as an investment analyst at Eagle Global Advisors in Houston, where he was part of a 3-person team that grew midstream/MLP AUM from $300mm to over $1bn from 2008 through 2011. He has also worked in investment roles at Millennium International and Strome Investment Management. He began his career in the UBS Investment Banking Global Energy Group in Houston.
Brad earned a BA in Philosophy, Political Science, and Slavic Studies from Rice University in Houston.
Statistics & Commentary
The performance data shown represents past performance. Past performance is not a guarantee of future results. Current performance may be lower or higher than the performance data quoted. The investment return and the principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost.
Sector Breakdown as a % of AUMas of 28/06/2019
Geographical exposure as a % of AUMas of 28/06/2019
Portfolio Characteristicsas of 28/06/2019
|No. of securities||41||88|
|Estimated Price/Earnings (x)||14.3||13.8|
|Estimated Long Term Growth (%)||8.2||6.3|
|Price to Book Ratio (x)||1.4||1.4|
|Price to Sales Ratio (x)||0.7||0.8|
|Weighted Market Cap ($bn)||58.4||69.9|
|Median Market Cap ($bn)||22.9||18.4|
|Active Share (%)||60.6||-|
Top 10 Position Detailsas of 28/06/2019
|Security name||Sector||% AUM|
|BHP Group LTD-SPON Adr||Metals & Mining||5.26|
|Total SA-SPON Adr||Oil, Gas & Consumable Fuels||4.83|
|Cenovus Energy Inc||Oil, Gas & Consumable Fuels||4.03|
|Rio Tinto Plc-Spon Adr||Metals & Mining||4.01|
|Freeport Mcmoran Inc||Metals & Mining||3.97|
|Barrick Gold Corp||Metals & Mining||3.50|
|Energy Transfer LP||Oil, Gas & Consumable Fuels||3.26|
|Upm-Kymmene OYJ||Paper & Forest Products||3.24|
|Plains GP Holdings LP-CL A||Oil, Gas & Consumable Fuels||3.20|
Investment Manager's Commentaryas of 28/06/2019
Market Review and Outlook
During the month of June, the Alma Recurrent Global Natural Resources Fund increased by 9.71% (I USD C), outpacing the 9.66% increase of the S&P Global Natural Resources Index. Commodity prices were strong during the month, as iron ore prices rose by more than 18% due to lingering global supply shortages resulting from the January 2019 Brazilian dam accident, and oil prices rose nearly by 10% as a result of increased tensions in the Middle East, primarily centering around Iran.
The portfolio benefited from stock selection in mining stocks, with Barrick Gold, Freeport McMoran, and Fortescue Metals increasing by 27%, 20% and 15% during the month, respectively. Additionally, the portfolio’s overweight position in refining benefited performance, as the sector rose by 19% during the month. From a portfolio positioning perspective, the portfolio remains overweight energy infrastructure stocks, given their inexpensive valuation, strong debt paydown cycle, and uniquely high dividend payouts.
Global Natural Resources Discussion
This month we highlight the unique investment opportunity in the US energy infrastructure sector in our white paper titled “The Journey Back From Junk”. Since the sector’s poor 2015 equity performance, market participants have been unsuccessfully trying to explain the causes, frustrating investors. In our white paper, we highlight that the underperformance is due to one underlying factor – debt leverage. During the decade from 2005-2015, while capital investment in energy infrastructure grew by 4x in order to support US shale oil and natural gas production, debt levels ballooned, taking the sector’s credit profile from investment grade to junk status. Our analysis shows that starting in 2015, the market accurately discounted the sector’s valuation, given the weakened credit profile. Importantly, the sector has taken significant steps to improve its credit profile, and is on the verge of returning to an investment grade profile, which has not yet been reflected in valuations, but should offer significant total return opportunities over the coming 12-36 months.
Facts & Documents
Fund Domicile: Luxembourg
Management Fee: 0.95% p.a. for I shares
Fund Type: UCITS SICAV
Fund Launch: 29 June 2018
Base Currency: USD
Depositary, Administrator, Transfert Agent: BNP Paribas Securities Services (LU)
Dealing: Each day with a 1-day notice
Cut-off time: 12 pm CET
Management Company: Alma Capital Investment Management (LU)
Investment Manager: Recurrent Investment Management (LU)
Fund Managers: Mark Laskin & Bradley Olsen
Countries where the fund is registered:
Institutional USD Capitalisation share class
ISIN: LU1823602369 Ticker: ARGNIUC LX Launch: 29 Jun 2018
Institutional EUR Capitalisation share class
ISIN: LU1845388146 Ticker: ARGNIEC LX Launch: 29 Jun 2018
available upon request