For the fourth quarter ended December 31st, 2021, KVF gained $1.08 per share, increasing the value of each share to $41.91. This low single-digit return is within the range of the -2% to +3% returns generated by the Russell 2000 and S&P/TSX indices, and below the 11% return of the S&P 500. Currency changes were a $0.05 per share headwind in the quarter.
For the year, KVF returned 43% pre-tax, which bested the indices quoted above by quite a bit.
This was a quiet quarter in terms of activity. KVF finally managed to sell out of a disasterous investment in SpaceAndPeople (LSE:SAL) for a huge loss, all of which had already been expensed in previous quarters. Many stocks in the portfolio experienced some weakness this quarter, which resulted in some opportunities to add to positions at more attractive prices.
The general market level remains expensive, which suggests investors should be cautious. There do appear to be some pockets of value that have developed, however.
KVF’s income statement and balance sheet are included below (click to enlarge). Note that securities are marked to market value, and amounts are in thousands of $CAD: