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Second Quarter Letter 2018

August-03-18

Second Quarter Letter 2018

For the second quarter of 2018, the Lester Canadian Equity Fund decreased by -0.2% net of fees and expenses, versus a rise of +6.8% for the TSX Composite Total Return including dividends. Our underperformance was due to our low weightings in the energy and materials sector, high weightings in utilities and cash, and declines in the value of several of our small cap holdings. The energy and materials sectors were up +17% and +8% respectively during the quarter and were responsible for nearly +5% of the rise in the TSX. Year-to-date, we are down -2.6% versus +1.9% for the TSX for the same reasons as outlined above. Since inception in July 2006, our Canadian equity strategy has produced a cumulative net return of +215%, more than double the +98% for the TSX. This represents an annual compound return of +10% per year over 12 years, net of all fees and expenses, versus +5.9% for the TSX Total Return including dividends. Measured in terms of “value added” active net returns, we have generated +4.1% per year over and above the market’s return during this period.