I wrote this in May of 2009 and again in August of 2022. And I am sending it out again. Don't let the fear of a correction, or a crash, keep you on the sidelines. At the same time, use a money manager who has a plan for if and when it does arrive, like us! Although we are bullish, the bear case is never far from our minds. In the meantime, be thankful for the current market highs. Maybe someone can send this to David Rosenberg.

"For reasons I have never understood, people like to hear that the world is going to hell. Pessimism isn’t just more common than optimism, it also sounds smarter. It’s intellectually captivating; pessimists are given more attention than optimists, who are often viewed as oblivious suckers. In investing, a bull sounds like a reckless cheerleader, while a bear sounds like a sharp mind who has dug past the headlines. John Stuart Mill wrote 150 years ago: “I have observed that not the man who hopes when others despair, but the man who despairs when others hope, is admired by a large class of persons as a sage.” Harvard professor Teresa Amabile wrote “Only pessimism sounds profound. Optimism sounds superficial." Why? There’s clearly more at stake with pessimism. Optimism appears oblivious to risks, so by default pessimism looks more intelligent. But that’s a wrong way to view optimists. Most optimists will tell you that things will get ugly, that we’ll have recessions, bear markets, wars, panics, and pandemics. But they remain optimistic because they set themselves up in great portfolios, captivating careers, and possess the disposition to endure those downsides. To the pessimist a bad event is the end of the story. To the optimist it’s a slow chapter in an otherwise excellent book. Misery loves company, as they say. Realizing that things outside your control could be the cause of your own problems is a comforting feeling, so we’re attracted to it. Pessimism is intellectually seductive, and the arguments always sound smarter, especially when they dovetail with our own worries. There's evidence that people hate losing money more than they like making it. Daniel Kahneman won the Nobel Prize for showing that people respond more strongly to loss than gain. That makes you more susceptible to following the pessimists' warnings than the optimists' outlook. Pessimism requires action, whereas optimism means staying the course. Pessimism is “SELL, GET OUT, RUN,” which grabs your attention because it’s an action you need to take right now. You don’t want to read the article later or skim over the details, because you might get hurt. Optimism is mostly, “Don’t worry, stay the course, we’ll be alright,” which is easy to ignore since it doesn’t require doing anything. Should you ever listen to pessimists? Of course! But count the perma bears on the Forbes 400 list or the number of pessimists who run companies in the Fortune 500 - you will find none! As John F. Kennedy said, “The great enemy of the truth is very often not the lie, deliberate, contrived and dishonest, but the myth, persistent, persuasive and unrealistic."

Should you have any questions or concerns, please feel free to reach out.

Portfolio Notes

(+) indicates a positive development, (-) indicates negative, and (~) indicates neutral

(+) Alimentation Couche-Tard (ATD-T) This was a bit of a noisy quarter driven in part by the impact of the U.S. hurricanes. ATD continues to foster a strong balance sheet, but we would note that Seven & I is increasingly looking like a low probability event given the take-private proposal from the founding Seven & I family. Overall, shares have underperformed the markets in recent weeks due to the pursuit of Seven & I. If management officially walks away from the transaction, we believe there’s a chance for shares to re-rate higher due to a lower risk of debt/equity issuance. Owned in Core & ESG+ Portfolios.

(sold) Amgen (AMGN-US) shares tumbled more after its weight-loss treatment helped patients lose up to 20% of their body weight on average over 12 months. Investors had high hopes for the drug, known as MariTide. It may not be as effective as Lilly's and incidences of sickness look worse than Lilly's. We exited our position in all portfolios.

(new) Aris Water Solutions (ARIS-US) is an environmental infrastructure company based in Houston, Texas. They specialize in providing water handling and recycling solutions for the oil and natural gas industry, focusing on gathering, transporting, and recycling produced water. New position in ESG+ Portfolio.

(+) Constellation Software (CSU-T) announced a fairly stable quarter. Some question the impact of AI on vertical market software. CSU management addressed the question at their most recent AGM, “Constellation has some businesses that generate meaningful revenue from AI. Perseus has been developing AI since the 2010s.” Management sees this like another tech shift, similar to mobile, and will adapt like they have in the past. From our perspective, we always start with growth and profit margins. If there are issues in a business model, they will surface in growth and profitability. CSU just reported 6% organic growth in its main business with increasing margins (partly due to AI efficiency). I know that is today and doesn’t address the future, and we’re well aware and looking into new AI applications almost daily. Owned in Core Portfolio.

(-) CrowdStrike (CRWD-US) delivered a very good quarter with management raising its full-year outlook on sales, operating income, and earnings. Nonetheless, shares of the cybersecurity firm were selling off as traders booked profits, perhaps because the current quarter profit guide came in a penny below expectations. Revenue during CrowdStrike’s fiscal 2025 third quarter increased 29% year over year to $1.01 billion, beating the consensus estimate of $928 million. It marks the first time quarterly revenue exceeded the $1 billion milestone. Adjusted earnings per share advanced 13% to 93 cents in the three months ended Oct. 31, ahead of EPS estimates of 81 cents. Owned in US and Opportunity Portfolios.

(+) MicroStrategy (MSTR-US) The bitcoin development company’s stock jumped 3% after Bernstein more than doubled its price target to $600 from $290, suggesting more than 40% upside from Friday’s close. Shares have soared about 568% so far this year. MicroStrategy acquired an additional 55,500 BTC for approximately $5.4 billion at an average price of $97,862 per bitcoin between Nov. 18 and Nov. 24, according to an 8-K filing with the Securities and Exchange Commission on Monday. The company now holds 386,700 BTC, worth over $37 billion. Owned in Opportunity Portfolio.

(new) Target (TGT-US) I like the improved risk-to-reward skew for this beaten-down stock. Target’s shares have lost about 12% year to date and the stock’s 3.6% dividend yield is very attractive. And on a more topical note, the retailer stands to benefit from one of the biggest publishing coups of the year Exclusive rights to Taylor Swift’s newest release, “The Eras Tour Book,” which may turn Black Friday into a red-letter day. New position in US Portfolio.

Company of The Week: Aris Water Solutions

2024 Q3 PRESENTATION

Weekend Reading

The Trump Trade War In one harshly worded statement last night, he has transformed trade relations — for the worse — between the U.S., Canada, Mexico and China. GREG VALLIERE

Proof Point: Are falling rents in Canada a temporary relief or a new trend? The asking rent for units across Canada fell for the first time in three years in October with big declines seen in the largest and most expensive cities of Toronto and Vancouver—providing some relief to lease hunters where rent unaffordability has been crushing. RBC

10 Best Personal Finance Tips Personal Finance is just as important as your investment decisions. You can save a lot of money with some very simple tricks. COMPOUNDING QUALITY

What is Coast FIRE? The Ultimate Guide to Semi-Retirement Do you like the idea of early retirement, but you don’t want to have to save every penny? Do you seek financial independence, but you don’t want to permanently leave the workforce? Then Coast FIRE might just be right for you. DOLLARS AND DATA

22 of the Funniest Moments in TV History True comedy gems. CRACKED

AI eats the world Every year, tech guru Benedict Evans produces a big presentation exploring macro and strategic trends in the tech industry. For 2025, it’s titled ‘AI eats the world’. BEN EVANS

Different Types Of Life Insurance Explained | Term Life, Whole Life, Universal Life, Variable Life This video explains life insurance from scratch and by the end you will confidently understand the differences between the major types of life insurance like Term Life Insurance, Whole Life Insurance, and Universal Life Insurance. PREET BANERJEE

Why Is Bitcoin's Price Dropping Right Now? POMPLIANO

Diversions

"The Madness" A consultant-turned-pundit must fight to prove his innocence after stumbling upon a murder in the Poconos. NETFLIX

“The Agency” The French spy series “Le Bureau” gets an English-language adaptation. PARAMOUNT+

“Beatles ’64” Scorsese produced documentary on the Fab Four’s first trip to the U.S. DISNEY+

"Chef's Table" Volume 6. An Italian butcher is included in this volume. NETFLIX

"The Umbrellas of Cherbourg" (1964) A romantic tragedy set in the French town. TRAILER (RE-RELEASE DEC 6TH)