Equinox Partners, L.P. - Q3 2014 Letter

Dear Partners and Friends,

PERFORMANCE & PORTFOLIO

Equinox Partners was down -10.2% in the third quarter of 2014 and we estimate -19.0% for the year to date through December 12.

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faith in the fed: an inflection point

Shortly after writing to you about our bullish outlook for shares of precious metals businesses (see Q1 2014 letter), our gold and silver miners began a sharp reversal of their first half appreciation. Our miners, having been up 45% at midyear, were up only 4% as a group through November.^[1] Compounding this loss, in the early fall we began expanding our ownership of extraordinarily profitable North American petroleum producers (even at today’s energy price), just as oil declined sharply due to a modest oversupply; we will discuss these companies in our next letter. Clearly, we are not market timers. The renewed weakness in emerging markets and foreign currencies also contributed to the painful volte-face in Equinox’s performance—a decline of 30% from our half-year peak of +16%. How did we achieve this combination of money losing outcomes—the forceful rise of the almighty U.S. dollar.

The dollar rally—the common link amongst our recent losses—reflects the accepted view that America has passed a critical monetary inflection point. In the eyes of the market, we’ve already crossed over from monetary loosening to tightening. Investors see the U.S. as well ahead of other developed economies on the path to normalization and accept the notion we will be able to exit our six-year monetary experiment without triggering another financial crisis. To our minds, not only is this conclusion premature, but it is flat out wrong.

We maintain that—despite the Fed’s protestations to the contrary—a return to meaningful positive interest rates, i.e., historically normal monetary policy, is extraordinarily unlikely. Our basis for this view rests on our confidence that meaningful real rates would put too great a burden on the still over-indebted Developed World economies. Central banks will, therefore, not normalize rates so long as the Developed World’s mountain of debt remains in place. This failure to normalize will in turn unmoor inflationary expectations and erode confidence in central banks like the Fed. Needless to say, with the expectation of normalization fully priced into our portfolio, we look forward to the translation of our theory into reality in the near term.

We find ourselves once again in a lonely position: Equinox is heavily concentrated in several investments reviled by the world around us. We submit that our clear-eyed recognition of the current extraordinary financial environment and the likely consequences of attempting to exit it, has positioned us in out-of-favor investments valued at extremes. We take this position confident that America’s true financial predicament should soon become undeniable and that Equinox will then reap substantial profits.

deflation is yesterday's story: an inflection point in prices

A historic episode of debt deflation undergirded the brief but rapid rise of the dollar against everything during the turbulent months of late 2008 and early 2009. This credit contraction-driven deflation predictably produced a desperate effort to re-liquefy the system on the part of the Federal Reserve. Think the collapse of Bear Stearns, Fannie Mae, Lehman Brothers, AIG, and money market funds followed by quantitative easing.

It is important to note that the aforementioned type of credit-driven deflation is fundamentally different from the deflation produced by the most recent dollar strength and supply-side driven commodity weakness (see graph below). The First World’s central bankers, however, have treated both types of deflation with the same medicine. Moreover, the Fed certainly has the tool (the printing press technology as described by Ben Bernanke) to avoid even the hint of deflation.

Thanks to half a decade of the Fed’s super-aggressive zero-interest-rate policy (aka ZIRP) and QE, the proximate threat of the Great Recession’s debt-deflation is behind us. Importantly, and more controversially, we also think that the sui generis causes of commodities price declines are now yesterday’s stories. Almost all have run their logical course.

For example, the new shale technology which has driven large and impressive improvements in production-cost declines is now fully priced into the oil and gas market. In fact, the substantial drilling declines resulting from today’s much lower oil prices may no longer even be enough to offset shale wells’ very high decline rates. Similarly, the post recession’s bust in shipping rates was caused by the massive supply response to much higher rates six years ago. But, rates can’t fall below shippers’ operating cost—the level reached last year. In the case of several agricultural prices, bumper crops grown on record acreage motivated by previous record-high prices have overwhelmed demand. Consequently, farmers are already cutting back.

Furthermore, we do not expect the deflationary forces stemming from weaker currencies abroad to continue. For the year to date, the dollar has appreciated more than 10% against the Euro and the Yen. Again, this is yesterday’s story. While Europe and Japan may be happy to depreciate their currencies further, such competitive devaluations have proven to be politically sensitive (and contagious) over time. If this is correct, and the 1930’s style “beggar thy neighbor” declines in the Yen and Euro are mostly behind us, the ECB’s and BOJ’s new rounds of QE will prove inflationary rather than deflationary in the international context.

The final, and by far most critical, piece in the long-term “flationary” puzzle is the rate of wage increases. Abroad, wage rates in the emerging world continue to rise. At home, job vacancies are up across the board suggesting that the reduced unemployment rate may be a better indicator of labor market tightness than the labor participation rate. The recent high in job openings—comparable to pre financial crisis openings in 2006—further supports the idea that the U.S. labor market has tightened to near full employment (see graph below).^[2] In sum, there are an increasing number of jobs for every qualified worker—a dynamic indicative of prospective wage inflation.

Tellingly, voluntary employment separations have climbed back to 56% of total separations as of October–meaning current workers are more willing to leave their jobs to find new ones.[3] At the same time in October, 24% of small businesses reported job openings they could not fill, continuing the recent trend (graph below).[4]

In short, deflationary pressures are not only a story of the past but we contend that the U.S. is at the critical point at which the seeds of problematic inflation have been planted and may soon begin to germinate. Mindful that we posited this same thesis four years ago (see Q3 2010 letter) and have suffered accordingly because of our failure to account for the extent of the supply-side deflationary shock, we nevertheless believe that the headwinds our portfolio has faced are now behind us.

Interestingly, several members of the Federal Reserve System have also openly hinted that more rapid price increases lie ahead. Bill Dudley, president of the NY Fed and member of the ruling triumvirate on the FOMC, seems oddly unfazed by the prospect of the economy “running a little hot.” By contrast, Richard Fisher, the Dallas Fed president, sees the same inflationary future and has expressed his deep concern about the Fed’s ability to contain inflation once it gets hold: "I believe we are at risk of doing what the Fed has too often done: overstaying our welcome by staying too loose too long." ^[5]

Fisher presumably takes little comfort in the knowledge that a solid majority of his peers on the FOMC have never participated in a rate increase at the Fed. It is hard to argue that the current board of the FOMC is well suited to deal with an unwelcome uptick in inflation.

When markets realize the Fed will not raise real interest rates to normal levels, we think that faith in the Fed will likely suffer a precipitous decline from its current lofty perch. Accordingly, our portfolio is configured confident that the Developed World central banks, such as the Fed, will not normalize.

our deeply discounted portfolio

The prices of our holdings assume that this extraordinary period in monetary policy is clearly behind us. The 70% decline in the major gold mining indexes since the end of 2010 through December 10, 2014 gives a sense of the headwinds we’ve faced as normalization has been priced into the market. In fact, silver and gold themselves are off 65% and 35% respectively from their 2011 peaks^[6]. The energy company indexes, similarly, are off 30% over four years despite the significant increases in their per share production. Moreover, bond yields of heavily indebted developed nations are near unfathomable lows. Finally, emerging markets have underperformed the U.S. S&P for four years running as capital has flowed back to the perceived safety of America.

From gold and silver, to oil and gas, prices are already discounting the permanent victory of the Federal Reserve over inflation, and our resource-oriented companies are discounting permanent disinflation. We, however, think that in a world of ever expanding fiat money, inflation is the natural outcome. Therefore, to sell depressed shares of our extraordinary attractive commodity-oriented companies at this point would be to snatch defeat from the jaws of victory.

Conclusion

As we look back on Equinox Partners’ first twenty years, we cannot help but reflect upon the enormous market swings that have characterized the period. From the mid-1990’s Scandinavian Banking Crisis, to the Asia Crisis, the Russia Crisis, the Internet Bubble, the Housing Bubble, and the Global Financial Crisis, the frequency and magnitude of booms and busts is truly stunning and their amplitude seems to keep getting bigger. We’ve not only survived these ups and downs, but as value-based investors we’ve prospered while enthusiasm for particular assets has ebbed and flowed to spectacular excess. Exploiting such excesses has compounded our profits from specific stock picking to produce a good, if volatile, return over the long run. But one extreme, today’s faith in central banking, has continued to build as others have come and gone.

While we are inured to unpopular investment venues, in one other respect today is different. The scale and scope of today’s financial imbalances are unprecedented in modern history. The First World’s collective decision to continue papering over, rather than addressing fundamental reform and change, has produced a global policy anomaly of immense proportion. To imagine that the Federal Reserve can and will now uneventfully dismantle America’s monetary stimulus of the last six years strains credibility.

Stock pickers at heart, we did not choose the current world in which we must operate. But given the situation in which we find ourselves, we will not shirk from aligning our portfolio with the financial reality. Surely, we look forward to the inflection point in U.S. monetary history in the coming year which will test our thesis that normalization is not an option.

organization

We’ve had two research analysts recently depart the firm. Yev Ruzhitsky, who focused on tech companies and the Russian market, has moved on to work at a long-only emerging markets fund. Tomo Izumi, a small-cap Japanese specialist, has launched Takumi Capital which we’ve seeded through Equinox Illiquid Fund, L.P. As a replacement, we’ve hired native Japanese and Reed College graduate, Kevin Gallagher.

Deferrals

Deferred tax investments comprise a sizable portion of the internal capital invested in our funds. Prior to 2008, performance fees allocated to the General Partner offshore were reinvested on a tax-deferred basis. These deferrals must now be paid out each year end through 2017. Importantly, these payments will be subject to ordinary income tax and, thus, nearly 50% will be taken by the government. After paying the taxes, we will both donate a portion of the proceeds to charity as well as reinvest a portion into Equinox Partners. We bring this to your attention because these mandatory distributions will likely reduce the General Partner’s capital account over the next three years. We, nevertheless, remain committed to having sizable investments in our funds, which also constitute large portions of our net worth.

Taxes

The pain of this year’s losses will be compounded by a sizeable tax bill for our onshore partners. Given our own sizeable ownership of the fund, we likewise share in this pain. We have, however, taken steps to mitigate the fund’s 2014 tax impact without substantially altering the portfolio. We expect these steps will reduce the figures as reported in the YTD Q3 2014 tax estimates. Our intention remains to own securities for long periods of time and, as a consequence, produce a relatively tax-efficient fund in the long run.

Sincerely,

Andrew Ewert

Sean Fieler

Daniel Gittes

William W. Strong

END NOTES

^[1] Performance figures are monthly gross IRRs.

^[2] Job openings per http://www.nfib.com/Portals/0/PDF/sbet/sbet201412.pdf

^[3] http://www.bls.gov/news.release/pdf/jolts.pdf

^[4] http://www.nfib.com/Portals/0/PDF/sbet/sbet201412.pdf

^[5] Monetary Policy and the Maginot Line (With Reference to Jonathan Swift, Neil Irwin, Shakespeare's Portia, Duck Hunting, the Virtues of Nuisance and Paul Volcker) Monetary Policy: Debate, Dissent and Discussion with Richard Fisher; University of Southern California, Annenberg School for Communication and Journalism ; Los Angeles, July 16, 2014.

^[6] Peaks of April 28, 2011 and September 5, 2011 for silver and gold respectively.

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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.

Equinox Partners, L.P. - Q2 2025 Letter

By Kieran Brennan • July 24, 2025

Dear Partners and Friends, PERFORMANCE Equinox Partners, L.P. rose Equinox Partners, L.P. rose +11.6% net of fees in the second quarter and is up +24.1% for the year-to-date 2025. By comparison, the S&P 500 index rebounded +10.9% in the second quarter and is now up +6.2% for the year-to-date 2025. Our portfolio has performed well across the board this year, with our gold miners, oil and gas producers, and emerging market businesses all appreciating. We were particularly gratified by the long-overdue outperformance of several of our earlier stage gold companies in the first half of this year. With markets and complacency on the rise, we think it prudent to address the non-negligible risk of an economic downturn. Beware the Next Recession

Kuroto Fund, L.P. - Q2 2025 Letter

By Kieran Brennan • July 23, 2025

Dear Partners and Friends, PERFORMANCE Kuroto Fund, L.P. appreciated +21.3% in the second quarter and is up +30.1% for the first half of 2025. By comparison, the broad MSCI Emerging Markets Index rose +12% in the second quarter and is up +15.3% for the first half of 2025. Key performance drivers for the fund have been our large position in MTN Ghana, as well as the strong returns from our holdings in Nigeria and the Republic of Georgia. A breakdown of Kuroto Fund exposures can be found here . Despite Kuroto Fund’s outperformance in the first half of the year, our portfolio remains very attractively valued. Given the diversity of business models we own, it is difficult to find metrics that provide an accurate picture of the value and quality of our portfolio in the aggregate. In the absence of an alternative, our portfolio’s weighted average price-to-earnings multiple of 7.3x 2025 earnings, dividend yield of 5.2% and ROE of 24.7% will have to do.

Precious Metals Fund - Q1 2025 Letter

By Dan Donohue • May 1, 2025

Dear Partners and Friends, PERFORMANCE Equinox Partners Precious Metals Fund, L.P. rose +23.4% in the first quarter of 2025. Over the same period the price of gold rose +18.9%. The fund’s performance was driven by strong returns from both the producing and exploration stage companies as gold crossed $3,000 per ounce. Trump's New Economic Policy Trump’s New Economic Policy has roiled markets and bolstered investor gold buying globally. While the violent market gyrations remain a focus for our team, we have also been thinking through the long-term effects of Trump’s policies. In this latter endeavor, Nixon’s 1971 New Economic Policy has proven an invaluable guide. The policy similarities between Nixon’s first term and Trump’s second are striking. Both presidents declared emergencies, raised tariffs, cut spending, reduced foreign aid, blamed foreigners, devalued the dollar , proposed tax cuts, attacked the Federal Reserve chair, and directly managed consumer prices. There are, of course, also meaningful differences. Most notably, Trump has raised tariffs more, devalued the dollar less, and has not imposed formal wage and price controls. Nevertheless, the policy resonance is striking.