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Alternative Market Briefing

Metals and mining fund finds opportunity in volatility

Friday, May 29, 2020

Bailey McCann, Opalesque New York for New Managers:

A new metals fund has been able to outperform despite significant volatility in the commodities market. Canadian firm Delbrook Capital's flagship strategy the Delbrook Resource Opportunities Master Fund returned +19.7% in April, resulting in a year to date return of +9.8%. The strategy outperformed the Barclay Financial & Metals Traders Index, which was up 0.08% in April and is down 0.09% year to date.

April's returns were driven by a "tactical decision to increase long exposure to specific large-capitalization precious metals equities on the back of the unprecedented global monetization of government liabilities," Delbrook managing director and portfolio manager Matthew Zabloski said his most recent letter to investors. Zabloski says the demand for hard assets has increased significantly in recent weeks and ETFs that provide exposure to these assets are seeing paper demand that outpaces physical metal capacity. That sets up the opportunity for profitable dislocations.

Delbrook Resource Opportunities is an equity long/short investment strategy focused exclusively on the metals and mining sector. The fund invests primarily in publicly listed companies that are focused on precious, base, energy, and industrial metals production and exploration. The strategy was launched in 2018.

Prior to launching Delbrook, Zabloski devel......................

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