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Bailey McCann, Opalesque New York for New Managers:

Metals and mining fund - Delbrook Resource Opportunities - from Delbrook Capital is having a banner year. The strategy was up +21.6% in July and is up 102.8% YTD. The results bring annualized returns since the fund's inception in 2018 to +78.8%.

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.

In a performance update to investors reviewed by Opalesque, the fund said that "we believe the present climate represents a critical inflection point for investors. Just six months ago, the precious metals sector was a source of 'value' investment opportunities. Since then, mass inflows of 'generalist capital' into the space has led to an appreciation of multiples across the sector, somewhat ignoring project or company fundamentals. As such, security selection, based on in-depth research and diligence, will be paramount."

The influx of new capital will provide opportunity for sector experts like Delbrook. The letter notes that in many cases, current valuations have decoupled from quality which is likely to provide new sources of alpha generation. Some of these opportunities are already emerging.......................

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