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B. G., Opalesque Geneva:

Thanks to a contrarian investment style and heavy allocations to metals and mining, Eschler Recovery Fund (ERF) retuned 19.5% (net) in 2019, compared to the Credit Suisse Long/Short Index's 10.9% return, and has annualised 6.2% since its October 2012 inception. The fund is managed by London-based Eschler Asset Management.

At the end of the year, the fund had long positions in resources-royalties (23%), gold, uranium (11%), silver, energy, and healthcare, and long and short positions in financials and macro hedges.

"Metals and mining was the largest industry allocation and a main contributor to fund performance in 2019, driven by precious metals equities," according to a letter to shareholders seen by Opalesque.

"Conversely, the uranium equity book was weak and is smaller than it was," PM Theron de Ris says in the letter. "While I believe a shock-and-awe uranium recovery (followed by a multi-year bull market) is increasingly inevitable, I am biding my time and keeping some dry powder."

Royalty holding

De Ris adds he has broken out the royalty holding as a separate category: "These businesses have distinctive characteristics as compared to their mining brethren and will be a larger commitment going forward. To simplify, royalty businesses usually receive 1-5% distributions annually from mine revenue for the life of the mine, in exchange for an upfront paymen......................

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