Equinox Partners, L.P. - Q1 2001 Letter

Dear Partners and Friends,

Performance 

In the past two quarters, Equinox’s outsized short position in technology stocks was quite profitable, as were our shorts in troubled and fraudulent businesses. Other short positions, in many cases serving as refuge for frightened growth stock investors, have only recently become profitable. 


On the long side of Equinox’s portfolio, one of our contrarian stock themes has performed well. From their lows last spring, our domestic tobacco stocks have almost tripled. Though the cigarette litigation environment is perceived to have improved (despite industry’s actual loss of the largest product liability suit in history in a local Florida court), the main source of strength for these stocks, beyond their record low valuations, has been their defensive nature. By serving as a refuge for nervous equity investors, even the tobacco businesses’ valuations are still a function of the “New Economic Paradigm”—only this time in reverse.


Our other “contrarian” longs, comprising the bulk of our portfolio, have not made money for Equinox in recent quarters. For example, our energy shares have yet to meaningfully respond to the startling increase in the price of scarce North American natural gas. And despite the U.S. stock market and economic setbacks the dollar has retained its phenomenal luster, causing our forsaken precious metals investments to retain most of that distinction. In addition to our deeply undervalued Asian companies, other potential beneficiaries of a dollar decline are our small but growing long positions in undervalued European businesses. As European markets follow the U.S. lower, we are just beginning to find Equinox-like bargains on that continent.



The initial revalution of worldwide equities, both up and down, has proceeded with a surprisingly measured pace.  The global bear market in technology and telecom stocks, while severe, has been orderly so far. While this has proved frustrating to our efforts to leverage our short portfolio with puts, it does provide us with multiple opportunities to change the mix of our shorts and to revisit those sectors which “bounce.” The continuing infatuation with technology companies is also providing us with multiple opportunities to own deeply discounted long positions that have been out of favor during the earlier manic phase. 

“All the Kings Horses and All the Kings Men…” The Mania at the First Anniversary of Its Peak

The graph below provides a long-term snapshot of the trajectory of the incredible stock market mania that dominated world markets during the 1990’s. This is because the level of margin borrowing is both a cause and effect of stock market speculation.


Customer Margin Debt as of February 2001





















Because of our unassailable confidence in our bottom-up value investment strategy, Equinox’s investment fate was to be the mirror image of this mania. Well aware of the asymmetry of short selling, but thinking that the parabolic rise of equity valuations could not continue, (Greenspan’s “irrational exuberance” speech was in December, 1996) we consciously bet against this trend. But the mania intensified still further, peaking only one year ago.


Although American stocks remain volatile (e.g. in January of this year Cisco Systems’ stock market capitalization swung $65 billion in one day-- three times the company’s annual sales!), it seems apparent that the extraordinary surge pictured above has finally passed its crest. We believe the demise of the 1990’s Humpty Dumpty stock market is not only irreversible but has much further to go.


Our assertion that the reversal of the 1990’s manic valuation anomalies is far from over rests on two fundamental premises:


1.      Valuation  The valuation extremes of the preceding bull market require a considerable further decline to reestablish even normal, let alone bargain, valuations. Consider the P/E for the American NASDAQ index. Despite its significant decline, the most recent estimate we have seen suggests the Over-the-Counter market is still selling for 150 times declining net income. This astronomically high multiple is only a “bargain” in comparison to its peak multiple a year ago—400 times! Broader U.S. indices still sell for richer valuations than those in the summer of 1929. To state the obvious, the reason that stocks are still significantly overpriced at these lower levels is that they were so incredibly overpriced at the peak. 


This is not to say that global stock markets can not rally. Indeed, bear market rallies are notoriously sharp. The restructuring of Equinox’s short portfolio, as described below, has substantially reduce the risk from our short side. 


2.   Economic   Our second reason for believing the domestic stock market correction has further to run, involves future economic performance. We are referring to the vulnerability of the global economy as a result of the previous extremes of the boom times (e.g. double-digit nominal GDP growth in the U.S.). Those extremes developed as a function of the self-reinforcing nature of economic behavior that George Soros calls “reflexivity.”  The unprecedented 1990’s boom was especially reflexive. From momentum investing to the underinvestment in energy that resulted from the massive overinvestment in technology, examples of this phenomenon abound. And as the “New Economic Paradigm” fed on itself on the way up, it probably will do likewise on the way down, thereby exaggerating the ultimate economic decline.


U.S. Savings Rate as Percentage of Disposable Income Thru February 2001
















Consider the dramatic decline in the proportion of their income that Americans save as pictured above. To our knowledge, there has never been a similar example of an increase in the propensity to borrow and spend. During the 1990’s credit card debt per household almost tripled. And Americans’ practice of borrowing and spending the equity in their homes has lowered the homeowners’ “equity cushion” to the lowest ever, despite monthly mortgage repayment and rising house prices. Our local Citibank branch has just started advertising, “There’s got to be at least $25,000 hidden in your house. We can help you find it.” As Fortune magazine (April 2, 2001) notes in a recent article on US consumer confidence:


“Right now, the refinancings and the cash-outs are buoying the economy because they give consumers more cash to burn. As Zandi(an economist) notes, ‘the refinancing wave could very well turn out to be instrumental in forestalling a more severe economic downturn.’ But he and other economists also see a darker side. By increasing their mortgage debt, writes Zandi, ‘cash-out re-fiers are weakening their balance sheets, making them more vulnerable to future financial problems.”



We do not think the dramatic drop in the savings rate is simply coincidental with the greatest stock market expansion of all time. If indeed the equity wealth effect caused the spending boom in the U.S., what does the decline in stock prices imply for future consumer spending? If reflexivity functions in reverse, consumer spending could drop precipitously (though consumer confidence has declined, the savings rate was still declining as recently as February of this year). In the future increasing unemployment, caused by companies trying to reestablish their past profitability, might cause heavily leveraged American consumers to spend less and fail to meet some of their debt service payments. Many stocks that should be adversely affected by these trends have yet to decline from their recent high valuations. Equinox has added such companies to our short exposure.

The “Seesaw Stock Market”: Equinox Broadens its Short Portfolio

Dow Jones down, NASDAQ up. NASDAQ down, Dow Jones up. In 1999 and early 2000, the old-fashioned Dow Jones Industrial Index declined while tech stocks soared. However, from the peak in tech stock speculation a year ago, America’s “seesaw stock market” (sector rotational investing) gave its tech-stock passengers a very unpleasant ride. It also provided Equinox with three successive quarters of escalating profits derived from our very outsized shorts in these companies. But the locus of the U.S. bear market was, until March 2001, essentially confined to the heretofore-sacrosanct tech/telecom sector. Few realize that the S&P 500 index, ex-technology stocks, hit an all time high at the end of last year.


The “seesaw” U.S. stock market has been a function of investors’ unshakeable confidence that the stock market provides superior returns in the long run. Never mind that this shibboleth is not necessarily accurate (It took the Dow Jones Industrials a quarter century to regain its levels of the late 1920’s, and in the last decade, Japanese stocks have lost two-thirds of their value). As “buying the dips” of “New Economy” shares has become a formula for compounding losses, Americans switched to buying “Old Economy” shares last year. Even during a week in mid-March of this year New York Stock Exchange New Highs prevailed over New Lows by an impressive ratio of 6:1.


Most investors are not aware of the speculative valuations of many non-technology shares. Though not as egregious as the tech mania, many popular large companies are, and have been for some time, selling for multiples of sensible valuations in the boom years of the U.S. economy, let alone in the recessionary environs of today. Recall what the massive dollar inflow into index funds during most of the late 1990’s did to the valuations of S & P 500 companies. For years, U.S. investors enjoyed extraordinary returns by purchasing mutual funds that were indexed to the S & P 500 index. This practice waned as the dot-com “investment” performance superceded even the self-reinforcing rich returns of index fund speculation. Nonetheless, trillions of mutual fund dollars remain lodged in this “passive” investment strategy and those that mimic it. We think that the recent initial net redemptions of index mutual funds represents an important straw-in-the-wind in the development of the domestic bear market.


 

Monthly Net New Cash Flowing into S&P 500 Index Funds

(in billions)






















Equinox has made a lot of money shorting technology shares. However, because of expensive non-tech stocks and a declining global economy, Equinox has altered our short portfolio by significantly broadening our exposure to overvalued domestic stocks. Although we are not of the opinion that technology shares are reasonably valued at these much lower prices, we have covered most of these shorts to make room for a broader array of shorts. We have identified other overpriced shares in businesses (financial and retail) and locals (California) that will be impacted by the stock market decline and the slowing of the U.S. economy. The recent appreciation of these shares provides Equinox with a “second bite of the short apple.” 


America’s Emerging Energy Shortage

The sexier part of America’s emerging energy shortfall story, electricity, has become highly visible. Bankruptcies and blackouts in California this past winter are front-page news. But the real trouble for the world’s sixth largest economy is likely to strike this summer, traditionally the season of peak electrical demand. In addition, the East Coast may suffer a long, hot summer this year because of a similar shortage (we only avoided blackouts last year because the summer was one of the coolest on record). It is unlikely that the sharp contraction of the investment banking business will remain the only economic problem the Big Apple faces this summer.


While the business of constructing new electrical generating capacity has spawned “New Economy” stock valuations, the companies that will provide the fuel for these new plants, natural gas, remain at the lowest valuations in the industry’s history. Since our last letter, the evolution of investor sentiment towards the energy sector is reflected in Morgan Stanely’s late February “Strategy and Economics” memo:


 “As gas and oil prices have remained elevated, the (investor) consensus has taken an aggressively skeptical stance regarding energy stocks—much more so than any other S & P 500 sector. … Expectations for massively reduced second-half energy earnings are all the more notable as the sector is one of only two (with utilities) that is still experiencing more upward than downward (earnings) revisions. … In a market that has fought the concept of reversion to the mean at every turn, the energy sector stands out for how aggressively investors now expect things to revert to the perceived norms (e.g. lower oil and gas prices).”


The low energy prices implied by the record low energy stock valuations seem to incorporate the view that higher prices lead to an economic contraction, which leads back to low energy prices. The circularity of the pessimistic rationale neglects the supply side of the price equation. We believe OPEC’s new found supply resolve recognizes the fact that world oil production is near capacity. But North American natural gas has a unique supply constraint, gas well decline rates in excess of 20% each year. The “accelerating treadmill” metaphor for gas production is apparent in the difficulty most gas producers we follow have in even maintaining output. (This is why we believe that Equinox’s gas producers, who are actually increasing production, are so valuable.) With significant new sources of supply like liquefied natural gas (LNG) years away, we assert that gas prices will remain strong.


The positive economics of energy are visible in the California morass. With reliability of supply such a high priority, Governor Davis is contracting for long-term electricity supply from independent power producers. One of the most aggressive of the new power plant builders, Calpine, plans to increase its generating capacity over the next five years (65,000 Megawatts) so as to require incremental annual gas consumption of 3 trillion cubic feet/year. This equals Canada’s entire current natural gas export to the U.S.! In anticipation of its substantial new power-plant development projects, Calpine must secure long-term natural gas reserves to “lock-in” its profit margin on its long-term electricity supply contracts with the likes of California. The following table illustrates Calpine’s recent purchase of Canadian producer Encal.



                                       Calpine Contracts to                            Calpine Acquires Encal for its

                                       Sell Electricity to CA (US$)                   Future Nat Gas Production (US$)


Contracted Price ($/MwH)              $66

Operating Cost / MwH                 - $10

Implied Price of Fuel / MwH        =$56


McFs of Nat Gas / MwH                    7


Implied Price of Natural Gas        =$8 ($56/7)                             $4 (Implied Cost of Nat Gas)



The deal represents the purchase of future gas production at a cost to Calpine of US$4/mcf. This compares very favorably with Calpine’s electricity sale price that effectively sells the gas, after profitably converting it to electricity, at US$8/mcf. The extraordinary profit that Calpine locks in with this transaction means we have not heard the last of Calpine’s aggressive pursuit of Canadian gas reserves!


This interest in purchasing gas reserves on the stock market by electricity power generators coincides with other energy conglomerates’ need to own reserves as part of a “total energy solution” marketing strategy. In addition, other oil and gas producers recognize that gas can be “found” more cheaply on the stock exchange than in the ground. The “real world” competition for gas reserves that has ensued is in sharp contrast with the pessimism of energy stock investors. Characteristically, Equinox’s position is consistent with the “real world.”

Profit Potential From the Current “What Me Worry” Financial Attitude

Such indicators as Americans’ still positive sentiment towards technology investments, their unwillingness to reduce consumption and the skeptical investor attitude towards our energy problem, imply that our countrymen have been suffering from a sort of denial about the now apparent ephemeral nature of the “New Economic Paradigm.” It is as if investors are sure that Cisco Systems will soon return to $80/share. After years of economic euphoria, stoked by an unending bull market and the conviction that technology will solve any economic problem, the return to reality will be a bitter pill. Mad magazine’s Alfred E. Neuman captured the mood with his, “What, me worry?” However, whether it is the end of the growth stock mania or the shortfall of cheap energy, the logic of supply and demand must finally reassert itself. Our portfolio’s incipient profitability is beginning to reflect the fundamental developments we have discussed for years.


Some believe that because the NASDAQ has lost two-thirds of its value, the short-selling opportunity is over. As discussed above, we fundamentally disagree. That said however, Equinox has chosen to pursue a lower risk shorting strategy that we believe to be equally prospectively profitable. However, Equinox’s continuing contrarian prospects are not limited to shorting overpriced stocks. More specifically, the undervaluation of our long positions, created by the distortions of the late mania, suggest even greater returns than shorting. The stock market reappraisal of most of our contrarian longs is just beginning.


Moreover, from our energy producers to our Asian and European businesses to our precious metals companies, our longs share something more than their astounding cheapness—namely, in each case we believe we have identified “best of breed” managements within their industries. These managers are true “executive marathoners” (one is literally an “ultra” marathon runner) whose focus is unrivaled and whose dedication allows them to not only survive, but thrive in the context of the current strenuous environments of their respective economies and industries. As with these managers, at Equinox we are optimistic about the long term prospects of continuously exercising a focused discipline of sensible investment. We look forward to sharing with you the ongoing rewards of our “micro” discipline of studied valuation/business/management stock picking as the head wind we have faced for so long finally subsides. These rewards should be substantial as the wind shifts to our backs. We believe this time has come.

Sincerely,

                                                                          

William W. Strong

Anthony R. Campbell

Precious Metals Fund - Q4 2025 Letter

By Kieran Brennan • February 3, 2026
Dear Partners and Friends, PERFORMANCE Equinox Partners Precious Metals Fund, L.P. rose +18.8% in the fourth quarter, finishing 2025 up +126.1% net of all fees. By comparison, the Junior Gold Mining Index GDXJ rose +18.9% in the quarter and finished the year up +176.5%. Our portfolio of producing mining companies led the returns for the quarter, in particular our companies that had silver exposure as well as our largest producer, Solidcore Resources. The spot gold price rose +12% in the quarter and finished the year up +64%. At the beginning of 2025, spot gold traded just north of $2,600 an ounce, and by the close of the year traded above $4,300 an ounce. The letter that follows discusses one of the key drivers of gold’s strong rally in 2025 and then delves into a thesis review for the fund’s largest positions at year-end. Trump's War on the Status quo It is no coincidence that our strong performance in 2025 corresponded with the first year of President Trump’s second term. Trump’s frontal assault on the international rules-based order ended decades of coordination between America and Europe, thereby liberating gold and silver from organized government price suppression. Looking ahead to the remainder of Trump’s second term, we expect additional long-dormant market forces to be unleashed as the Western coalition that maintained the post-war economic system breaks down. We also expect America’s unilateral market interventions (such as the current effort to suppress the oil price) to be less successful than the coordinated interventions that characterized the post-World War II era. The uninterrupted rise in the gold price last year was in large part due to deteriorating relations between the US and Europe. In a break with eighty years of history, at no point did any Western government so much as feign interest in the gold price rally. Neither France, nor Italy, nor the IMF threatened to sell any of their substantial gold reserves. Instead, the gold price suppression scheme run by Western governments for decades simply vanished. We don’t know if the Trump administration formally decided to abandon America’s policy of gold price management or if the fraught relationship between Europe and the US simply made continued coordination in the gold market impossible. Perhaps Western governments collectively concluded that a gold price suppression scheme had become untenable given the growing list of government gold buyers. Regardless of the cause, the Western government policy of gold price suppression appears to be over. In a related break with the status quo, Western governments and their financial institutions also stopped managing the silver market. We sense that silver price suppression was never an end in and of itself. Rather, controlling the price of silver was necessary to credibly control the price of gold given the close correlation between the two metals. Accordingly, if the gold market isn’t managed, then neither does the silver market need to be. While America’s next president may pursue a different policy posture towards Europe, America’s relationship with Europe is forever altered. This change will eventually be reflected institutionally and geopolitically, but its effect can already be seen in the markets. The rising gold price is just one of the first signs of this change. While America’s break up with Europe will at times be unsettling, we expect the resulting changes to be positive for our precious metals companies. Investment Thesis Review for our Top 5 Positions by Weight Thesis Gold: 10.2% Portfolio Weight Thesis steadily advanced its Lawyers-Ranch project in British Columbia in 2025. Most notably, in December the company formally initiated the provincial and federal Environmental Assessment process, which starts the permitting clock. Typically, the permitting process would take 3 years, but the government of British Columbia has indicated they would like to complete this sooner. Thesis Gold shares’ outperformance, up 325%, reflects not only their permitting progress, but also the growing possibility of a bidding war for the company. In May 2025, Centerra Gold took a 9.9% stake in Thesis. Given Centerra’s strong financial position (net cash balance sheet and substantial annual free cash flow) and the proximity of their Kemess project to Lawyers-Ranch, they are a likely bidder when their lockup expires in May of this year. That said, we believe with Lawyers-Ranch’s attractive size and location profile, the project should eventually attract offers from multiple intermediate producers. Furthermore, with revaluation of the silver price, the project’s silver content has become increasingly valuable. At strip prices, over 30% of the project’s revenue would be attributable to silver. While Lawyers-Ranch won’t attract the premium of a pure-silver asset, the high silver weighting makes it appropriate for silver companies, thereby increasing the upside multiple. Thesis is not dependent upon a bid to develop their project. They are fully financed through the expected completion of their Feasibility Study in 2027 and could easily finance the entire mine construction capex by selling a silver royalty. Once in production, Thesis should produce 200,000 ounces of gold equivalent per year for 15 years. With a $550 million market cap, we calculate this investment to be a 30%+ IRR assuming flat metals prices. Solidcore Resources: 9.8% Portfolio Weight In 2025, Solidcore made significant progress towards cutting its remaining ties to Russia. Notably, they bought back all the shares held in Russian depository and meaningfully advanced the construction of their new Kazakhstan-based POX plant. With the completion of the Russian share buyback on December 19th, 2025, Solidcore ended a multi-year standoff with Euroclear and created a path to reinstating their dividend. With respect to the POX plant, Solidcore successfully transported their new 1,100-ton autoclave manufactured in Belgium to site in Ertis, Kazakhstan, which was a year-long, technically demanding logistics operation. It required night-time transportation, reinforced roads, and careful coordination to avoid disrupting city life. With the autoclave now in place, the project has begun to ramp full-scale POX construction. We believe the new POX plant could be up and running by year-end 2027, at which point we would expect Solidcore to re-list their stock on the London Stock Exchange. CEO Vitaly Nesis is working to put in place a world-class board and, along with an LSE-listing, recapture the premium valuation that Polymetal garnered prior to the Russian invasion of Ukraine. It is not often that a CEO gets to build the same company twice, but we think that will be the case for Vitaly Nesis and Solidcore. The scale of the revaluation opportunity for Solidcore remains mouthwatering. With a current market cap of $3.5 billion, net cash of $1 billion, and annual free cash flow of $1 billion, Solidcore trades at a 2.5x Enterprise Value to FCF (EV/FCF) multiple. Similarly sized peers typically trade at a 10x EV/FCF multiple or more. We think the dividend will be an initial catalyst for revaluation, and the ultimate revaluation will occur when the equity re-lists on the LSE. Troilus Mining: 7.8% Portfolio Weight Troilus changed their narrative from "if they" to "when they” go into construction by securing $700 million in project financing in March 2025, which they later upsized to a $1 billion package in November. The $1 billion debt financing covers more than 70% of the project’s $1.3 billion capex. Last December, Troilus raised an additional $175 million of equity, and we expect the $125 million balance of construction cost will be easily financed by selling a royalty on the mine’s by-product metals, such as silver. On the regulatory and permitting front, in June, the company submitted their Environmental and Social Impact Assessment (ESIA) to the Government of Canada and Government of Quebec. Importantly, government officials have identified the Troilus project as one of the country’s 10 key natural resource developments of interest. Mark Carney even traveled to Berlin with Troilus to sign their offtake agreement, removing any doubt about government support for the project. This de-risking, both operationally and financially, has positioned Troilus as one of a select few large-scale projects advancing towards construction in Canada. When in production, the Troilus mine will produce an average of 303,000 ounces annually for 22 years at an estimated All-In Sustaining Cost of $1,450 per ounce. When the gold price was $2,000, Troilus was a marginal project in a good jurisdiction. Now with gold trading north of $5,000, Troilus is a high return project in a good jurisdiction. Troilus shares re-rated aggressively in 2025, but the company still only trades at a market capitalization of $650 million, more than a 70% discount to the project’s Net Present Value (using a 5% discount rate and spot metals prices). The mine will be the 5th largest gold mine in Canada, and we anticipate that several large mining companies will have a close look at the project before Troilus makes a final investment decision in December 2026. Hochschild Mining: 7.5% Portfolio Weight Hochschild overcame early operational headwinds at their new Mara Rosa mine in Brazil to finish the year with significant momentum. Despite a summer production warning and subsequent leadership transition at the COO level, the company met its revised annual guidance of over 300,000 gold equivalent ounces. Hochschild's portfolio is anchored by the high-margin Inmaculada mine in Peru which produced 5.6 million ounces of silver last year. Because of Inmaculada, ~40% of Hochschild's revenue is derived from silver at today’s spot prices. Such a high level of silver exposure is unusual and should result in a premium valuation. With a $4.8 billion market cap with no net debt and over $550 million of expected free cash flow in 2026, Hochschild’s valuation reflects no such premium. Hochschild’s new COO Cassio Diedrich (formerly Global Head of Mining for Base Metals at Vale) brings the specific regional and technical expertise required to optimize the growing Brazilian portfolio. Furthermore, the addition of a Brazil Country Manager with a pedigree from Lundin Mining and Yamana Gold significantly de-risks the execution of the Monte do Carmo build. If Hochschild executes on their growth plan, the company could generate over $1 billion in annual free cash flow by 2028. They are now in a strong financial position to fund both growth capex and a meaningful dividend internally from free cash flow. West African Resources: 7.2% Portfolio Weight In 2025, West African Resources (WAF) brought their new Kiaka mine into production on time and on budget. Now with two large, low cost and long-lived mines, WAF is the largest and most profitable gold producer in Burkina Faso. We expect WAF to produce more than 470,000 oz per year through 2040. Unfortunately, the company’s success has not gone unnoticed in cash-strapped Burkina Faso. In September, the government of Burkina Faso expressed their interest in acquiring an additional 35% of the newly completed Kiaka mine as was allowed by the country’s 2022 mining code. As the government does not have the cash to pay for an additional 35%, and the request appears to be an extra-legal attempt to increase the government’s free carry. The uncertainty caused by the government’s effort to up their stake in the Kiaka mine created a cascade of problems for WAF. Most importantly, their shares were suspended on the Australian stock exchange while the uncertainty was sorted out. While the government of Burkina Faso seems to have lost its enthusiasm for a transaction, WAF still must deal with the overhang and optics of the approach. The result is a particularly cheap stock reflecting the political uncertainty of operating in Burkina Faso. WAF has an equity market cap of $2.5 billion and will generate close to $1 billion in annual free cash flow. This exceptionally low valuation comes despite the long-lived and low-cost high-quality assets the company has put into production. The more recent Kiaka mine has a planned life until 2043 and the Sanbrado mine, which started production in 2020, has a modelled life through 2034 that will likely be extended by several years. The aggregate life of mine All-In Sustaining Costs (AISC) for WAF’s projects are just under $1,700 per ounce, putting WAF into the better half of the global gold mining cost curve. We expect the uncertainty around the operating environment in Burkina Faso to clarify over the course of 2026 and 2027. The government, at every level, now understands that it receives the majority of the economics of WAF’s gold mines operated in Burkina Faso. Additionally, with gold mining as the chief economic engine for the country, the government’s interests are best served in both the short and long run by encouraging gold mining and extracting their majority share of the economics. Negotiating for more of the economics simply makes it impossible to attract companies to make incremental investments in the country.

Kuroto Fund, L.P. - Q4 2025 Letter

By Kieran Brennan • January 28, 2026
Dear Partners and Friends, PERFORMANCE K uroto Fund, L.P. appreciated +8.5% in the fourth quarter and finished the year up +64.9%. By comparison, the broad MSCI Emerging Markets Index rose +4.8% in the quarter, finishing the year up +34.4%. The positive contributors to Kuroto’s performance were broad-based, with 11 stocks contributing over $1 million of gains for the year and only 2 positions detracting more than $1 million. The biggest contributors to the performance were MTN Ghana, our Nigerian stocks, and Georgia Capital. The biggest detractors were Kosmos Energy and Gran Tierra. Looking at our portfolio today, we are surprised at how attractive it still looks given our performance last year. Our portfolio’s price to earnings ratio is 5.9x for 2026, with a dividend yield of 6%, generating an ROE of 28%. While these are imperfect metrics, they don’t show a portfolio that’s expensive. We take a more nuanced look at the valuation of our top five positions below, which represent 61% of the portfolio today. Moreover, we are still finding attractive incremental investment opportunities. In this regard, Brazil stands out as a particularly attractive incremental market for us. With policy rates at 15%, local investors are happy to hold fixed income securities which has kept equity valuations depressed. As concerns about US economic policy grow, risk capital should flow to emerging and frontier markets. US equities account for 47% of total equity value globally. Brazil, by contrast, accounts for just 0.6% of global equity value. Needless to say, a small shift from US equity markets to EM markets could result in a meaningful upward revaluation of emerging market stock markets such as Brazil’s. A breakdown of Kuroto Fund exposures can be found here . Investment Thesis Review for the Top Five Positions by Portfolio Weight MTN Ghana: 20.5% Portfolio Weight MTN Ghana continues to be our largest investment. Through the first nine months of 2025 (full year results are not yet released), the company’s revenue grew 36.2% and earnings were up 45.9%. It generated a ROE of over 50% and is on track to pay out 80% of earnings in dividends. The company continues to dominate the voice and data telecom services market, as well as money transfer and digital payments in the country. The biggest growth driver of the business has been data. Our understanding is that latent demand for data is such that any investment MTN Ghana makes into its telecom infrastructure is immediately utilized. MTN has not been under-investing in infrastructure, but its competitors have been. The second largest competitor was Vodacom, but they sold out to Telecel in 2023. Since purchasing Vodacom Ghana, Telecel has underinvested in its network and has been losing market share. The third and fourth largest networks, Bharti Airtel and Tigo, merged their operations in 2017 to attempt to compete more effectively, but they did not invest enough to be competitive and ended up selling to the government in 2021 for $1. Since then, the government has absorbed the third player’s operating losses while not investing meaningfully in infrastructure. Currently, the government is considering both selling a stake to remove ongoing losses as well merging its Airtel-Tigo with Telecel to create a stronger competitor to MTN Ghana. Combining two under-invested networks will not fix the problem unless someone commits to spending a meaningful amount of capital to add to and upgrade telecom infrastructure. MTN Ghana has invested over $3 billion to make its network the dominant one in the country. It’s unlikely someone will come forward to write a check big enough to meaningfully alter that dynamic. The second biggest growth driver, and potentially the most valuable piece of the business longer term is the mobile financial services business – MoMo. MTN continues to dominate money transfers and payments in the country with 90%+ market share. In early 2025, the government removed the e-levy tax on money transfer which spurred growth for the year. Now the service mix is shifting to higher value services like merchant payments and savings and lending products and away from pure person-to-person money transfer. The company recently separated its mobile financial services business from its telecom business internally, and going forward will report the financials of these businesses independently. The company is guiding that in 3-5 years they will list the mobile financial services business separately. It’s possible that this leads to a higher valuation for the group at some point, as these sorts of fintech businesses tend to trade at much higher multiples than telecom businesses. In our estimates, we see the stock currently trading at 5.6x our estimate of 2026 earnings, earning a 55% ROE and paying out a 10.7% dividend yield. The company forecasts high-30s% revenue growth in the medium term, stable margins, and a continued 80%+ payout ratio. Georgia Capital: 12.2% Portfolio Weight Georgia Capital had a great year. From December 2024 to the end of Q3 2025, the company’s NAV per share increased 42%. And for the full year 2025, the company is forecasting a 46% increase in FCF per share. The share price outpaced the intrinsic value growth, and the discount to the sum of the parts that the stock trades at has come in from ~50% discount at year end 2024 to a ~25% discount today. There were three big drivers of Georgia Capital’s performance in 2025. The first was the strong performance of its largest holding, Lion Finance Group (formerly known as the Bank of Georgia). Since 2019, when current CEO Archil Gachechiladze took over, Lion Finance Group has transformed from a good bank into a great one. The ROE expectation has increased from low-20s% to high 20s%, Net Promoter Score has increased from mid-30s to mid-70s, and 2025 EPS is forecast to be nearly 5x what it was in 2019. In 2025, the bank continued to perform strongly and is now getting recognized for it in the stock market. Listed in London, it is now a FTSE 100 stock, and having had traded around 1x book value for the past 5 years, is now at closer to 1.5x Price to Book Value. We think the bank will continue to grow revenues at a double-digit percentage, earn a high 20s% ROE, and support a 5%+ dividend yield. As such, we think Lion Finance Group stock still trades at a very reasonable valuation, and are comfortable with it as just over half of Georgia Capital’s NAV. The second big driver for Georgia Capital in 2025 was its aggressive share repurchase program. Since merging with its healthcare subsidiary in August 2020, Georgia Capital has shrunk its share count from 47.9 million shares to 35.4 million at the end of Q3 2025. From Q1 through Q3 this year, they repurchased 10.4% of their beginning of 2025 shares outstanding and continued to buyback through Q4. They funded this aggressive buyback through a combination of operating cash flow, selling down some of the group’s stake in the bank, and disposing of some non-core assets. Repurchasing shares while trading at a substantial discount to NAV is a good recipe for NAV per share growth, and Georgia Capital did a lot of that this year. Now that the discount has closed to a ~25% discount, this is less attractive but still reasonable given that look-through valuation is still only a single digit P/E multiple. The third key 2025 driver for Georgia Capital was the increase in value of the rest of Georgia Capital’s portfolio. The biggest pieces of the group after the bank are its pharmacy business, hospital business, and insurance company. Pharmacy and hospitals saw a 21.1% and 38.7% increase in operating cash flow respectively, and insurance saw a 23% increase in profit before tax. We expect continued double-digit profit growth in the medium term for these businesses, though not 20%+, which was helped by a cyclical margin recovery in 2025. Currently, our look-through P/E multiple for the group is 7x, which is attractive for this combination of businesses that earn good returns on capital and grow earnings double digits. Going forward, we anticipate growth will be driven more by earnings growth and capital returns rather than a decrease in the holding company discount to the sum of the parts. As such, we’ve trimmed the position modestly. Seplat Energy: 12.2% Portfolio Weight Seplat acquired Exxon Mobil’s shallow water operating unit in December 2024, more than doubling the size of its production and reserves. As a result, 2025 was a year of asset integration. Thus far, the company has managed the much larger production base well. Production averaged 135,000 barrels of oil equivalent per day (boepd) in the first three quarters of 2025, up from less than 50,000 boepd prior to the acquisition. Seplat has maintained this level of production throughout the year without drilling any incremental wells into the former Exxon Mobil assets, only reactivating old, previously shut-in wells. In fall of 2025, Seplat unveiled their 5-year plan for the newly combined portfolio. Encouragingly, Seplat was able to keep most of the Exxon Mobil in-country team, many of whom have 20+ years of experience with these assets and were trained to Exxon’s global standards. This makes the five-year plan to grow corporate production from 130,000 boepd to 200,000 boepd look very achievable. Seplat is trading at a high single digit FCF yield at the current low-$60 oil price. Debt to cash flow is less than 1x. They plan to pay out 45% of FCF as dividends while also investing to grow production approximately 9% per year for the next 5 years. Assuming a $65 Brent oil price, Seplat is guiding for a cumulative $2 to $3 billion in FCF over the next 5 years, which compares to their equity market cap of $2.5 billion. By 2030, Seplat should be producing over 200,000 boepd, generating north of $500 million in FCF annually and still have a long growth runway ahead. That said, it is no longer as enormous of an outlier in terms of valuation relative to some other emerging market oil and gas ideas we have, two of which are trading at north of 20% free cash flow yield today or in the next six months. Solidcore Resources: 11.8% Portfolio Weight In 2025, Solidcore made significant progress towards cutting its remaining ties to Russia. Notably, they bought back all the shares held in Russian depository and meaningfully advanced the construction of their new Kazakhstan-based POX plant. With the completion of the Russian share buyback on December 19th, 2025, Solidcore ended a multi-year standoff with Euroclear and created a path to reinstating their dividend. With respect to the POX plant, Solidcore successfully transported their new 1,100-ton autoclave manufactured in Belgium to site in Ertis, Kazakhstan, which was a year-long, technically demanding logistics operation. It required night-time transportation, reinforced roads, and careful coordination to avoid disrupting city life. With the autoclave now in place, the project has begun to ramp full-scale POX construction. We believe the new POX plant could be up and running by year-end 2027, at which point we would expect Solidcore to re-list their stock on the London Stock Exchange. CEO Vitaly Nesis is working to put in place a world-class board and, along with an LSE-listing, recapture the premium valuation that Polymetal garnered prior to the Russian invasion of Ukraine. It is not often that a CEO gets to build the same company twice, but we think that will be the case for Vitaly Nesis and Solidcore. The scale of the revaluation opportunity for Solidcore remains mouthwatering. With a current market cap of $3.5 billion, net cash of $1 billion, and annual free cash flow of $1 billion, Solidcore trades at a 2.5x Enterprise Value to FCF (EV/FCF) multiple. Similarly sized peers typically trade at a 10x EV/FCF multiple or more. We think the dividend will be an initial catalyst for revaluation, and the ultimate revaluation will occur when the equity re-lists on the LSE. Guaranty Trust: 8.9% Portfolio Weight Guaranty Trust performed well in 2025, posting a 31% ROE while growing their loan book by 16%. Earnings per share declined 6% YoY due to the normalization of their foreign currency earnings (rather than any deterioration in the business). After a lost decade under the former President Buhari, Nigeria is now beginning to grow again. GDP grew at 4% in 2025 despite weak oil prices, and government foreign exchange reserves are again healthy. Where inflation ran at 25% a year ago, it dropped to 14.5% as of November 2025. We expect Nigerian interest rates to follow inflation lower, which should spur loan growth. For the first time we can remember, Nigerian businesses are borrowing and investing, the currency has been stable, and the locals we speak to are genuinely optimistic. With a capital ratio of over 40% and a loan-to-deposit ratio of only 27%, Guaranty Trust remains Nigeria’s most conservative bank. With a cost of funding of only 3% and a cost to income ratio of sub-30%, Guaranty Trust doesn’t have to take much credit risk to generate spectacular returns on equity. Not surprisingly, simply owning government bonds is their preferred strategy in the current rate environment. Today, Guaranty Trust trades at 3.3x forward earnings and just less than book value. We expect the company to continue earning at least a high-20s% ROE, which should support both a 10%+ dividend yield and strong loan growth. Sincerely, Sean Fieler & Brad Virbitsky

Equinox Partners, L.P. - Q4 2025 Letter

By Kieran Brennan • January 28, 2026
Dear Partners and Friends, PERFORMANCE Equinox Partners, L.P. rose +17.3% net of fees in the fourth quarter, finishing the calendar year 2025 up +80.9%. By comparison, the S&P 500 index rose +2.7% in the fourth quarter and +17.9% for the year. Our precious metal miners accounted for the vast majority of our gains last year. Our relatively small exposure to non-commodity Operating Companies in Frontier & Emerging markets also performed extremely well. Our energy equities declined modestly, and our equity shorts were roughly P&L neutral for the year. Trump's War on the Status Quo It is no coincidence that our strong performance in 2025 corresponded with the first year of President Trump’s second term. Trump’s frontal assault on the international rules-based order ended decades of coordination between America and Europe, thereby liberating gold and silver from organized government price suppression. Looking ahead to the remainder of Trump’s second term, we expect additional long-dormant market forces to be unleashed as the Western coalition that maintained the post-war economic system breaks down. We also expect America’s unilateral market interventions (such as the current effort to suppress the oil price) to be less successful than the coordinated interventions that characterized the post-World War II era. The uninterrupted rise in the gold price last year was in large part due to deteriorating relations between the US and Europe. In a break with eighty years of history, at no point did any Western government so much as feign interest in the gold price rally. Neither France, nor Italy, nor the IMF threatened to sell any of their substantial gold reserves. Instead, the gold price suppression scheme run by Western governments for decades simply vanished. We don’t know if the Trump administration formally decided to abandon America’s policy of gold price management or if the fraught relationship between Europe and the US simply made continued coordination in the gold market impossible. Perhaps Western governments collectively concluded that a gold price suppression scheme had become untenable given the growing list of government gold buyers. Regardless of the cause, the Western government policy of gold price suppression appears to be over. In a related break with the status quo, Western governments and their financial institutions also stopped managing the silver market. We sense that silver price suppression was never an end in and of itself. Rather, controlling the price of silver was necessary to credibly control the price of gold given the close correlation between the two metals. Accordingly, if the gold market isn’t managed, then neither does the silver market need to be. It’s unfortunate that Trump has paired his liberation of gold and silver with the enthusiastic suppression of the oil price. This, too, is a break with the status quo. We are aware that for most of the post-war period, America has worked with a coalition of Western oil consuming countries to ensure the long-term availability of oil at reasonable prices. But Trump’s policy of targeting an uneconomic oil price is unprecedented. Should Trump achieve his stated goal of $50 oil, such a low price will prove unsustainable. With oil averaging $60 over the past year, there has been no increase in US production and non-OPEC supply increases have been muted. Perhaps direct government subsidies can spur a supply increase from Venezuela, but that remains to be seen. Absent new government subsidies, oil production growth will prove a challenge at $60, let alone $50. Harold Hamm, a close Trump confidant, has conveyed this message to Trump. Presumably, Trump realizes his policy of oil price suppression is unsustainable. We certainly do. While America’s next president may pursue a different policy posture towards Europe, America’s relationship with Europe is forever altered. This change will eventually be reflected institutionally and geopolitically, but its effect can already be seen in the markets. The rising gold price is just one of the first signs of this change. While America’s break up with Europe will at times be unsettling, we expect the resulting changes to be positive for our commodity exposures, as well as our deeply discounted companies in Frontier and Emerging markets. Investment Thesis Review for our Top 5 Long Positions By portfolio Weight Solidcore Resources: 11.8% Portfolio Weight In 2025, Solidcore made significant progress towards cutting its remaining ties to Russia. Notably, they bought back all the shares held in Russian depository and meaningfully advanced the construction of their new Kazakhstan-based POX plant. With the completion of the Russian share buyback on December 19th, 2025, Solidcore ended a multi-year standoff with Euroclear and created a path to reinstating their dividend. With respect to the POX plant, Solidcore successfully transported their new 1,100-ton autoclave manufactured in Belgium to site in Ertis, Kazakhstan, which was a year-long, technically demanding logistics operation. It required night-time transportation, reinforced roads, and careful coordination to avoid disrupting city life. With the autoclave now in place, the project has begun to ramp full-scale POX construction. We believe the new POX plant could be up and running by year-end 2027, at which point we would expect Solidcore to re-list their stock on the London Stock Exchange. CEO Vitaly Nesis is working to put in place a world-class board and, along with an LSE-listing, recapture the premium valuation that Polymetal garnered prior to the Russian invasion of Ukraine. It is not often that a CEO gets to build the same company twice, but we think that will be the case for Vitaly Nesis and Solidcore. The scale of the revaluation opportunity for Solidcore remains mouthwatering. With a current market cap of $3.5 billion, net cash of $1 billion, and annual free cash flow of $1 billion, Solidcore trades at a 2.5x Enterprise Value to FCF (EV/FCF) multiple. Similarly sized peers typically trade at a 10x EV/FCF multiple or more. We think the dividend will be an initial catalyst for revaluation, and the ultimate revaluation will occur when the equity re-lists on the LSE. Troilus Mining: 10.9% Portfolio Weight Troilus changed their narrative from "if they" to "when they” go into construction by securing $700 million in project financing in March 2025, which they later upsized to a $1 billion package in November. The $1 billion debt financing covers more than 70% of the project’s $1.3 billion capex. Last December, Troilus raised an additional $175 million of equity, and we expect the $125 million balance of construction cost will be easily financed by selling a royalty on the mine’s by-product metals, such as silver. On the regulatory and permitting front, in June, the company submitted their Environmental and Social Impact Assessment (ESIA) to the Government of Canada and Government of Quebec. Importantly, government officials have identified the Troilus project as one of the country’s 10 key natural resource developments of interest. Mark Carney even traveled to Berlin with Troilus to sign their offtake agreement, removing any doubt about government support for the project. This de-risking, both operationally and financially, has positioned Troilus as one of a select few large-scale projects advancing towards construction in Canada. When in production, the Troilus mine will produce an average of 303,000 ounces annually for 22 years at an estimated All-In Sustaining Cost of $1,450 per ounce. When the gold price was $2,000, Troilus was a marginal project in a good jurisdiction. Now with gold trading north of $5,000, Troilus is a high return project in a good jurisdiction. Troilus shares re-rated aggressively in 2025, but the company still only trades at a market capitalization of $650 million, more than a 70% discount to the project’s Net Present Value (using a 5% discount rate and spot metals prices). The mine will be the 5th largest gold mine in Canada, and we anticipate that several large mining companies will have a close look at the project before Troilus makes a final investment decision in December 2026. Silver Futures: 9.0% Portfolio Weight Despite the more than three-fold increase in the silver price since January 2024, the supply and demand deficit for the metal hasn’t improved much. Beginning with supply, we expect a de minimis year over year increase in mine supply in 2026 and a 30-million-ounce uptick in recycling. Taken together, we forecast total silver supply will increase 4% in 2026. It’s worth noting that an uptick in recycling is likely a one-time phenomenon, and going forward silver supply growth will depend solely on mine supply. On this point, despite the high silver price, we expect very little mine supply growth again in 2027. Sustained increases in silver mine supply require a more permissive permitting regime in countries such as Mexico, Guatemala, Peru and Chile. Even at $100 an ounce, we expect industrial demand for silver to remain basically flat. Silver is used in industrial applications because of the unique attributes of its valence electrons, and there is no good substitute in most cases. Absent government restrictions on silver use, we don’t foresee much of a decline in industrial silver demand. The one area of possible demand destruction is in Indian silverware purchases. Given the inelasticity of both silver supply and demand, we foresee only a modest increase in the metal available for investment to 150 million ounces. (See supply and demand table below) Importantly, a sizable fraction of these 150 million ounces will be consumed by mints producing silver coins. Most incremental investment demand will have to be met by existing owners of metal and the physical silver market will remain tight. We remain bullish, but we’ve trimmed 80% of our silver ounces given the price move.

Value Investor Insight Interview October 2025 Issue with Sean and Brad

By Kieran Brennan • November 11, 2025
Value Investor Insight Profile with Sean Fieler and Brad Virbitsky

Precious Metals Fund - Q3 2025 Letter

By Kieran Brennan • October 31, 2025
Dear Partners and Friends, PERFORMANCE Equinox Partners Precious Metals Fund, L.P. rose +36.2% in the third quarter of 2025 and is up +90.2% for the year-to-date 2025. By comparison, the Junior Gold Mining Index GDXJ rose +46.6% in the quarter and is up +132.7% for the year-to-date. Exploration stage companies were the best performing segment of the portfolio, appreciating +55.0% in the quarter. The spot gold price rose +18% in the quarter and is up +47% for the year-to-date. The letter that follows provides our thoughts on the outlook for the gold price and implications for the portfolio holdings. gold The gold bull market, initially driven by central bank buying, has evolved into an investor-driven dollar debasement trade. This second phase of the gold bull market is more explosive than the first because it draws on the approximately $470 trillion of the world’s wealth as opposed to the roughly $35 trillion of central bank balance sheets. If President Trump fans the dollar debasement fire by forcing a politicized Fed to cut rates, gold could rapidly displace the dollar as the world’s reserve currency. However, if President Trump takes a more nuanced approach to the Fed, gold should still displace the dollar as the world’s reserve currency over time with the competition between gold and the dollar taking longer to play out. Gold investors warning about fiat currency debasement is nothing new. That, after all, is why gold investors own gold in the first place. There’s also nothing new about most American investors ignoring these warnings. The dollar’s relative stability has long made concerns about dollar debasement appear quixotic. Since the early 1980’s, American inflation has been largely tolerable, the dollar has outperformed almost all other fiat currencies, and U.S. government bonds have been the safest asset to own in an economic downturn. The dollar has sloughed off so much criticism for so long that Janet Yellen likely did not imagine the chain of events that freezing Russia’s foreign exchange reserves would set into motion. With confidence in the dollar’s inertia and a bit of hubris, in our opinion, Secretary Yellen engineered the freezing of $300 billion of Russia’s foreign exchange reserves and put the world’s central banks on notice that their use of dollar reserves depends upon the tacit approval of the U.S. Treasury. Foreign governments, shocked by this policy change, sought to reduce their dependence on the U.S. Treasury and doubled their gold purchases to roughly $60-80 billion per year (potentially $100 billion in 2025). This increase in central bank gold demand drove the gold price up over +50% from March 2022 to March 2025. This bull market, in turn, gave gold the additional scale necessary to function as a more viable alternative to the dollar and damaged the dollar’s air of invulnerability. This two-fold outcome is problematic because inertia and a lack of alternatives were fundamental to the dollar’s stability. On the back of gold’s appreciation, long-ignored arguments of gold investors began sounding more plausible. Financial professionals accustomed to deriding gold investors and referring to them as insects began to worry that gold’s price action is telling them something important. Jamie Dimon aptly summed up the change of heart: “This is one of those times where it is semi-rational to own gold.” His comment captures both his continued distaste for gold and his willingness to own it. Despite the broadening acceptance of gold as an investment, markets remain skeptical of the underlying dollar-devaluation narrative. Inflation, a broad measure of the dollar’s strength, is just 2.8%. The 10-year U.S. Treasury yields 4.0%, indicating the bond market’s indifference to the dollar debasement narrative. Furthermore, the decline in the trade weighted dollar has partially reversed since early July. At this moment, the dollar debasement trade appears to be waiting for additional macroeconomic and geopolitical events to play out. Of these, none looms larger than President Trump’s effort to bend the Federal Reserve to his will. In January, the Supreme Court will likely allow President Trump to remove Federal Reserve Board Governor Lisa Cook, making the selection of the next Fed Chair even more important. If Trump nominates a loyalist like Kevin Hassett who appears more committed to pleasing the President than price stability, we could see broadening concern about the dollar’s store of value and a growing asset allocation into gold. In this hyper-politicized Fed scenario, gold could quickly become a $100 trillion dollar asset and displace the dollar as the world’s reserve currency. However, if Trump nominates an institutionalist like Chris Waller, the dollar debasement trade will likely remain in limbo for a while as markets suss out how much control Trump really has over the Fed. Either way, the U.S. bond market will not be allowed to freely adjudicate the outcome at the Fed. We expect both Treasury and Fed to proactively manage the yield curve during the particularly politically sensitive period when the Fed is cutting rates while inflation is above their stated 2% target. Treasury will keep longer-dated bond issuance to a minimum while coercing banks to keep the Treasury market well bid. JP Morgan increased its holdings of Treasuries by $80 billion in the first half of this year, and we expect other banks to follow suit. The Fed, for its part, has announced an end to quantitative tightening and its intention to shift its balance sheet from mortgage-backed securities to Treasuries. Given the likely extent of the coordinated intervention of the Treasury and Fed, the bond market will not be a good indicator of the market’s confidence in Trump’s economic policies. Gold will be. To the extent that investors sense that the bond market is not providing a reliable price signal, they will begin paying more attention to gold. And, should the gold price becomes the accepted indicator of U.S. financial health, the Trump administration will take action to influence it. At the very least, this will entail the Trump administration encouraging other central banks to stop buying gold or even sell gold. But the anti-gold policy options are limitless. Needless to say, the U.S. government pushback on gold will not solve the dollar’s long-term structural problems. Nor will it mark the end of gold’s challenge to the dollar. It will simply mark the next phase of financial repression. Our Gold Mines The second phase of the bull market in gold has been broadly positive for our portfolio, as a portion of the investor money flowing into gold has bid up gold mining equities as well. Where central banks buy the physical gold bullion, private wealth investors allocating to gold will also buy gold mining stocks. The GDXJ Junior Mining Index is up +132.7% for the year-to-date through September 30. Even with this year’s rapid rise in the gold mining portfolio, valuations remain cheap at spot gold prices. Our in-production portfolio trades at a 24.0% IRR as compared to a 23.4% IRR on March 31. The most dramatic mis-valuation among our gold miners continues to be in the pre-production companies. While these equities have appreciated more rapidly than our producing companies for the year-to-date 2025, they began from such a low valuation that even at twice or three times their January price, they are still undervalued. Troilus Gold, a junior gold mining company with an 11.2 million ounces gold-equivalent resource in Quebec, Canada, is a case in point. Troilus Gold shares have more than tripled in 2025, rising from C$0.31 to C$1.35 per share. The company still trades at an IRR of 30%, 0.2x price-to-NAV (using a 10% discount rate), and a price per ounce of recoverable gold of $63. When Troilus goes into commercial production in 2029, we expect it will generate annual net income roughly equal to its current market cap. Troilus historically traded at an extremely low valuation because the market did not believe that the company could finance the project's upfront capital expenditure of $1.3 billion. Throughout 2025, Troilus began addressing these financing concerns by signing an offtake agreement with a European smelter and a related letter of intent for $700 million of debt financing on attractive terms. If Troilus Gold raises the necessary equity and signs a streaming arrangement to fully fund the mine’s construction, we believe the stock will trade much closer to its NAV (using a 10% discount rate and the spot gold price) of $2.5 billion.

Equinox Partners, L.P. - Q3 2025 Letter

By Kieran Brennan • October 30, 2025
Dear Partners and Friends, PERFORMANCE Equinox Partners, L.P. rose +24.5% net of fees in the third quarter and is up +54.4% for the year-to-date 2025. By comparison, the S&P 500 index rose +8.1% in the third quarter and is now up +14.8% for the year-to-date 2025. Our quarterly performance has been almost exclusively driven by our gold and silver miners. In the third quarter, the spot gold price rose +18%, and the fund’s mining portfolio returned +40%. As of this writing, 78% of Equinox Partners’ capital is invested in the gold and silver sector. The letter that follows provides our thoughts on the gold price and our gold mining holdings. Gold The gold bull market, which was initiated by central bank buying, has evolved into an investor-driven dollar debasement trade. This second phase of the gold bull market is more explosive than the first because it draws on the approximately $470 trillion of the world’s wealth as opposed to the roughly $35 trillion of central bank balance sheets. If President Trump fans the dollar debasement fire by forcing a politicized Fed to cut rates, gold could rapidly displace the dollar as the world’s reserve currency. However, if President Trump takes a more nuanced approach to the Fed, gold should still displace the dollar as the world’s reserve currency over time with the competition between gold and the dollar taking longer to play out. Gold investors warning about fiat currency debasement is nothing new. That, after all, is why gold investors own gold in the first place. There’s also nothing new about most American investors ignoring these warnings. The dollar’s relative stability has long made concerns about dollar debasement appear quixotic. Since the early 1980’s, American inflation has been largely tolerable, the dollar has outperformed almost all other fiat currencies, and U.S. government bonds have been the safest asset to own in an economic downturn. The dollar has sloughed off so much criticism for so long that Janet Yellen likely did not imagine the chain of events that freezing Russia’s foreign exchange reserves would set into motion. With confidence in the dollar’s inertia and a bit of hubris in our opinion, Secretary Yellen engineered the freezing of $300 billion of Russia’s foreign exchange reserves and put the world’s central banks on notice that their use of dollar reserves depends upon the tacit approval of the U.S. Treasury. Foreign governments shocked by this policy change sought to reduce their dependence on the U.S. Treasury and doubled their gold purchases to roughly $60-80 billion per year (potentially $100 billion in 2025). This increase in central bank gold demand drove the gold price up over +50% from March 2022 to March 2025. This bull market in turn gave gold the additional scale necessary to function as a more viable alternative to the dollar and damaged the dollar’s air of invulnerability. This two-fold outcome is problematic because inertia and a lack of alternatives were fundamental to the dollar’s stability. On the back of gold’s appreciation, long-ignored arguments of gold investors began sounding more plausible. Financial professionals accustomed to deriding gold investors and referring to them as insects began to worry that gold’s price action is telling them something important. Jamie Dimon aptly summed up the change of heart: “This is one of those times where it is semi-rational to own gold.” His comment captures both his continued distaste for gold and his willingness to own it. Despite the broadening acceptance of gold as an investment, markets remain skeptical of the underlying dollar-devaluation narrative. Inflation, a broad measure of the dollar’s strength, is just 2.8%. The 10-year U.S. Treasury yields 4.0%, indicating the bond market’s indifference to the dollar debasement narrative. Furthermore, the decline in the trade weighted dollar has partially reversed since early July. At this moment, the dollar debasement trade appears to be waiting for additional macroeconomic and geopolitical events to play out. Of these, none looms larger than President Trump’s effort to bend the Federal Reserve to his will. In January, the Supreme Court will likely allow President Trump to remove Federal Reserve Board Governor Lisa Cook, making the selection of the next Fed Chair even more important. If Trump nominates a loyalist like Kevin Hassett who appears more committed to pleasing the President than price stability, we could see broadening concern about the dollar’s store of value and a growing asset allocation into gold. In this hyper-politicized Fed scenario, gold could quickly become a $100 trillion dollar asset and displace the dollar as the world’s reserve currency. However, if Trump nominates an institutionalist like Chris Waller, the dollar debasement trade will likely remain in limbo for a while as markets suss out how much control Trump really has over the Fed. Either way, the U.S. bond market will not be allowed to freely adjudicate the outcome at the Fed. We expect both Treasury and Fed to proactively manage the yield curve during the particularly politically sensitive period when the Fed is cutting rates while inflation is above their stated 2% target. Treasury will keep longer-dated bond issuance to a minimum while coercing banks to keep the Treasury market well bid. JP Morgan increased its holdings of Treasuries by $80 billion in the first half of this year, and we expect other banks to follow suit. The Fed, for its part, has announced an end to quantitative tightening and its intention to shift its balance sheet from mortgage-backed securities to Treasuries. Given the likely extent of the coordinated intervention of the Treasury and Fed, the bond market will not be a good indicator of the market’s confidence in Trump’s economic policies. Gold will be. To the extent that investors sense that the bond market is not providing a reliable price signal, they will begin paying more attention to gold. And, should the gold price becomes the accepted indicator of U.S. financial health, the Trump administration will take action to influence it. At the very least, this will entail the Trump administration encouraging other central banks to stop buying gold or even sell gold. But the anti-gold policy options are limitless. Needless to say, the U.S. government pushback on gold will not solve the dollar’s long-term structural problems. Nor will it mark the end of gold’s challenge to the dollar. It will simply mark the next phase of financial repression. Our Gold Mines The second phase of the bull market in gold has been broadly positive for our portfolio, as a portion of the investor money flowing into gold has bid up gold mining equities as well. Where central banks buy the physical gold bullion, private wealth investors allocating to gold will also buy gold mining stocks. The GDXJ Junior Mining Index is up +131% for the year-to-date through September 30. Even with this year’s rapid rise in the gold mining portfolio, valuations remain cheap at spot gold prices. Our in-production portfolio trades at a 24% IRR as compared to a 25% IRR on March 31. The most dramatic mis-valuation among our gold miners continues to be in the pre-production companies. While these equities have appreciated more rapidly than our producing companies for the year-to-date 2025, they began from such a low valuation that even at twice or three times their January price, they are still undervalued. Troilus Gold, a junior gold mining company with an 11.2 million ounces gold-equivalent resource in Quebec, Canada, is a case in point. Troilus Gold shares have more than tripled in 2025, rising from C$0.31 to C$1.35 per share. The company still trades at an IRR of 30%, 0.2X its NAV (using a 10% discount rate), and a price per ounce of recoverable gold of $63. When Troilus goes into commercial production in 2029, we expect it will generate annual net income roughly equal to its current market cap. Troilus historically traded at an extremely low valuation because the market did not believe that the company could finance the project's upfront capital expenditure of $1.3 billion. Throughout 2025, Troilus began addressing these financing concerns by signing an offtake agreement with a European smelter and a related letter of intent for $700 million of debt financing on attractive terms. If Troilus Gold raises the necessary equity and signs a streaming arrangement to fully fund the mine’s construction, we believe the stock will trade much closer to its NAV (using a 10% discount rate and the spot gold price) of $2.5 billion. New Board Seat at Gran Tierra Energy On September 30, portfolio company Gran Tierra Energy announced that Brad Virbitsky has joined the board on behalf of Equinox Partners. While it is a relatively modest-sized position in the fund, we believe there is significant value to unlock, and we can help realize that value through our participation in the boardroom.

Kuroto Fund Wins 2025 HFM US Global Equity Award

By Kieran Brennan • October 30, 2025
Kuroto Fund Wins HFM 2025 US Performance Award

Kuroto Fund, L.P. - Q3 2025 Letter

By Kieran Brennan • October 30, 2025
Dear Partners and Friends, PERFORMANCE Kuroto Fund, L.P. appreciated +16.6% in the third quarter and is up +51.6% year-to-date 2025. By comparison, the broad MSCI Emerging Markets Index rose +11.0% in the third quarter and is up +28.2% for the year-to-date. Performance in the quarter was driven primarily by our investments in Nigeria, with additional strong contribution from our largest position, MTN Ghana. A breakdown of Kuroto Fund exposures can be found here . Portfolio Changes During the third quarter, we initiated a position in Solidcore Resources, a company described in our February webinar . Solidcore is similar to the oil companies we profiled in our Q2 2025 letter in that it is a competitively advantaged commodity producer. The company’s main asset is a long-lived and low-cost mine, the management team is among the best in the region, and the infrastructure they are building will make them a natural consolidator of regional assets. Given the subsequent increase in commodity prices, we ended up purchasing the bulk of our position at a 40%+ free cash flow yield. Solidcore is now a top 5 position in the fund. We funded our purchase of Solidcore by reducing our Georgia Capital position weighting from 17% to 11% and by selling our stake in a Greek consumer-focused business. In the case of Georgia Capital, while the discount to the sum of the parts value decreased from 50% to a more reasonable 30%, we still see it as a compelling investment opportunity. Georgia Capital’s portfolio of oligopolistic businesses is growing earnings double digits, buying back stock, and trading at a single digit, look-through price-to-earnings multiple. The sale of our Greek investment was driven by stock appreciation combined with a management change that led us to re-underwrite our investment. GHANAIAN AND NIGERIAN MACRO Over the past decade, Nigeria and Ghana have endured a seemingly unending series of self-inflicted macro problems. Inflation increased to over 30% in both countries, and the currencies depreciated 64% and 79%, respectively. Ghana defaulted on its domestic and foreign debt in 2023, and Nigeria imposed onerous capital controls for multiple years. However, 2025 has been a turning point for both countries. For the first time in over a decade, investors in these markets are experiencing macroeconomic tailwinds. In Ghana, since the beginning of the year, the currency has appreciated 43% vs. the U.S. dollar, GDP growth averaged over 6%, the budget has been in primary surplus, inflation declined from 24% to 9%, and debt to GDP declined from 62% to 43%. Ghana’s macro environment has improved due to three factors: One, Ghana’s debt restructuring is mostly finished, and the country now has a much smaller interest expense burden, which should decline further as the central bank lowers rates to be more in line with the decline in inflation. Two, the new government which assumed power in January has cut spending 14% in real terms. Three, the country has been helped by the large increase in the gold price, which is both the country’s largest export and a significant component of Ghanaian central bank reserves. Ghana now has 4.8 months of import cover, half of which is held in gold bullion. Whether Ghana can maintain this strong start to the year is an open question, but the fundamentals are certainly in a better place than they have been in the past decade. In Nigeria, President Tinubu’s bold reforms upon taking office are finally starting to have some effect. In 2023, Tinubu eliminated the local fuel subsidy which consumed about 40% of the government’s annual revenues, floated the currency which resulted in a 68% depreciation, forced a recapitalization of the banking sector, and removed the board of the notoriously corrupt national oil company and replaced them with technocrats who formerly worked at companies like Exxon and Shell. While not perfect, the scale of the reforms is impressive by any standard. A year later, inflation has fallen from over 30% to the high teens and is expected to fall to single digits next year. Economic growth has increased from less than 3% to over 4%. Oil production is up more than 10% and oil theft is down 90%. Importantly, the exchange rate has been stable for a year and anecdotally, we are hearing that conditions on the ground are night and day different, businesses are looking to invest, and banks are willing to lend. We initially invested in Ghana and Nigeria in 2018 with the expectation that both countries would eventually adopt a sane set of macroeconomic policies. While it took longer than we expected, sane policy is gaining traction in both countries, and our superior companies are getting re-rated to more sensible, albeit still very cheap, valuations. In Ghana, our main investment has been in MTN Ghana, which has compounded at approximately 25% in U.S. dollar terms since 2018 despite all the on-the-ground challenges. The stock’s historical return understates our investment performance because we increased our weighting at opportune times. The total contribution to our P&L has been +$17.7 million over that time frame, resulting in a +24.9% cumulative contribution to fund returns. Our Nigerian investment results have also been strong. While our initial entry was poorly timed, we added counter-cyclically, and as a result have generated +$9 million of P&L, contributing a cumulative +15.0% to the fund’s return. Our experience in both markets underscores the importance of our investment strategy of looking at out-of-favor markets to find competitively advantaged, well-run businesses at unusually cheap valuations. NEW BOARD SEAT AT GRAN TIERRA ENERGY On September 30th, portfolio company Gran Tierra Energy announced that Brad Virbitsky has joined its board on our behalf. While it’s a relatively modest position size in the fund, we believe there is significant value to unlock and we can contribute to that process through our participation in the boardroom. Sincerely, Sean Fieler & Brad Virbitsky

Precious Metals Fund - Q2 2025 Letter

By Kieran Brennan • August 1, 2025
Dear Partners and Friends, PERFORMANCE Equinox Partners Precious Metals Fund, L.P. rose +13.2% in the second quarter of 2025 and is up +39.7% for the first half of 2025. By comparison, the Junior Gold Mining Index GDXJ rose +18.7% in the quarter and is up +58.7% for the first half of the year. Our meaningful year-to-date underperformance relative to the GDXJ reflects the continued discount at which our companies trade compared to peers. Specifically, our portfolio of producing companies trades at an average internal rate of return (IRR) of 24%, roughly double the 11.5% IRR of the broad universe of gold miners that BMO covers. the gold mining bull market is young The skepticism that characterizes the gold mining sector stands in sharp contrast to the enthusiasm in the broader stock market. The animal spirits that have propelled popular stocks like Wingstop and Robinhood to an average of nearly 80 times 2025 earnings remain totally absent among gold mining investors. One indication of the sober mood that dominates the gold mining sector is the use of gold price assumptions below spot in net asset value (NAV) calculations. Looking at four important sell-side houses for the sector, their models include an average long-term price assumption of $2,400 per ounce, representing a 28% discount to the quarter-end spot price. 
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