Sprott Inc. aims to double its assets to about C$16 billion ($13 billion) in the next three years by adding consumer and technology stocks to legacy gold holdings as the equity bull market nears an end.
While the Canadian money manager is positive on U.S. and European growth, it’s also bracing for volatility as central banks raise interest rates, said John Wilson, chief executive officer of the firm’s asset management unit. He’s invested in more defensive stocks such as Alimentation Couche-Tard Inc. and CGI Group Inc. that are geared towards international growth.
Canadian software provider Shopify Inc.’s 51 percent surge on its New York trading debut in May underscores the bull market’s advancing age, Wilson said.
“That’s not the start of a bull market cycle,” Wilson said in an interview in Bloomberg’s Toronto office. “That tells you where we are in the equity cycle. My best guess is we have a year or two left.”
Sprott, founded by gold investor Eric Sprott in 1981, hired Wilson in 2012 to help diversify the firm as the precious metal tumbled. Assets edged up to C$7.8 billion in the first quarter after sliding to C$6.97 billion at the end of 2013 from a peak of C$9.93 billion in 2012.
Non-resource assets now make up about 75 percent of Sprott’s actively managed funds, compared with 27 percent in 2012, the company said.
Sprott has risen 4.5 percent to C$2.55 this year, compared with a 3.1 percent gain in the Standard Poor’s/TSX Composite Index. It’s down almost 75 percent from a 2011 peak of C$9.60.