FOCUS 2026: Value with clarity: What fundamentals are telling us now

Kathryn Black: Good morning, everyone. Thank you for being here.

Dan Dupont: Very happy to be here, thank you.

Kathryn Black: It is an exciting month and a very exciting month for you specifically because we are launching a brand new mandate which is going to be unrestricted Dan, Global Concentrated Value Fund and ETF is going be coming out on May 20th as Dave alluded to in his opening. Super excited to talk about that today because it's building on what you've already been doing for the past 15 years in Canadian Large Cap and the tactics that you do way. Just touch on the new mandate that you're gonna be running for us.

Dan Dupont: It's very simple. It's the same process, it's the same thinking, same way of investing for me. It's just, basically, Dan unhinged. It's Canadian Large Cap fund with less restrictions. I don't need to be in Canada.

Kathryn Black: Hopefully not totally unhinged.

Dan Dupont: I'll be able to go anywhere around the world and buy the best ideas so very excited about that.

Kathryn Black: Very excited about that. Please reach out to your sales teams to get more information on that. We're gonna dive in to really where your head's at in this current world, in this current market, different sectors that you're looking at, themes. For the next 40 minutes or so feel free to send in your questions for Dan. We're gonna take a trot around the world here. Let's kick things off. Over the last two days ... we'd be remiss if we didn't talk about AI in our conversation. You said that it's pretty much the one theme, one trend, one trade that you're seeing in the market today.

Dan Dupont: More and more, yeah.

Kathryn Black: Give us your thoughts. CapEx is projected at $700 billion for 2026 and increasing. What's your views? Where are you at with regards to the current market, specifically AI?

Dan Dupont: I know a lot of AI was discussed yesterday and probably even more in the next few today but I think it just needs to be discussed because it is basically the one theme. It is driving everything and it is starting to touch every single aspect of the investment world. As more and more time goes by and these large companies invest the numbers become large and then the borrowing becomes extremely large. $700 billion of CapEx this year, $900 billion next year, these are fairly sizable numbers. It used to be a little bit from cash flow but now they're so big that they are borrowing a lot of that money and it's showing up in profitability in the companies that are part of that bottleneck of whatever needs to be deployed to build that infrastructure, which in the short term I think is ...

I mean, profitability this year for the S&P is now expected to be somewhere around 19%, which is very, very high from an historical perspective outside of periods coming out of a recession, but that profitability is obviously very concentrated, 50% of that is Micron and Nvidia and then if you take the top eight it's basically 70%, 80%. Outside of that earnings growth is low single digits. That's after 18 years of no credit cycle. These companies right now are not having a hard time borrowing the money. There's a lot of things that we need to think about around that. I think for me being more of a defensive type investor, and I even took some notes because I'm so passionate about this right now, I think it's gonna start to show up in some areas that are much more central to other sectors as well.

Kathryn Black: Do you want to show that to the crowd, those detailed notes on there? Chicken scratches.

Dan Dupont: Scribbles I had. First of all, the expected 5-year EPS growth in IT is 28%. That, historically, is a bit of a sign that people are really, really bullish about a sector. We've rarely seen such numbers come through, actually, so first reason to be a little bit more circumspect about the numbers. Also, there's two angles. One is, I think, the potential for mischief is very high right now. The first large transaction that was announced in the AI space, if you will, was OpenAI with Microsoft a long time ago, several quarters ago. I went to our analyst and I said, this is a big number, $10 billion, changing hands, that's kind of a big transaction. He said, oh, no, no, it's not cash, it's just ownership for compute. I said, okay, so it's 10 billion so could it just have been 5 billion and then they both decided, you know what, let's say that the compute is worth twice as much and let's say that our 1% ownership instead of being worth 5 is worth 10, and then we put a press release out and it's worth 10.

If you're somebody that is unscrupulous you would do that. I'm sure they didn't do that, of course, but I'm just saying at the margin it's tempting to do these types of things. Obviously, the people who've been in the business long they'll remember 2000 when a lot of these things were done and then eventually kind of unravelled and came up to the surface once everything goes straight back down. In the euphoria of the moment people don't ask a lot of questions. Back then there was a lot of exchange for capacity on fibre optic networks. Enron did a swap with Quest for $650 million where it basically swapped revenues. You report the quarter, if nobody cares about earnings which is basically the case right now, that's really one area where I think there might be some small problems that erupt at some point. Who knows who's playing some games but there's a risk of some games being played.

The other angle that I think is interesting is the financing side. The credit markets have been wide open for basically ... they've had small wobbles here and there, during COVID for about three weeks, but we've had 18 years of really good credit markets to the point where people don't even react anymore. I've been involved in arbitrage a lot in the last 15 years and if you look at the current environment there's two gigantic deals that nobody ... oh, Electronic Arts is being acquired for $50 billion cash. Nobody talks about that. Then a few weeks later, well, Warner Brothers is being acquired by Paramount for $100 billion cash. That same day J.P. Morgan comes out and they say, yeah, we'll do a bridge loan for $20 billion. It's just business as usual, just a casual Monday.

I think there's risk there because at some point ... I don't know if it's because the numbers are so big in the AI financing side that some people will start to get nervous. I read an article yesterday on Bloomberg about banks that are trying to diversify their lending book because they're going after the fees. It's fun to lend $25 billion to Microsoft but maybe you want to kind of diversify that around. It's probably even worse if you go smaller cap. All of these things are kind of moving around. It's very interesting that people look at that earnings growth number for this year in the S&P and get all excited when as a kind of a global economy we're doing a giant experiment here. Of course, there's a lot of profitability in the short term because everybody's buying stuff to build something that is not depreciated yet. In the first quarter the hyperscalers had depreciation of $40 billion and they spent 130. That gap of 90 is just gonna keep getting probably a little bigger for a few quarters and eventually they're gonna have to start really depreciating that stuff because, again, we're forecasting 700 billion this year.

You look at the profitability of what's being built and it's not obvious just yet that it's gonna be super profitable, or some of them are gonna end up taking advantage of all that infrastructure in a great return on capital way. That makes me a little nervous. Everybody's kind of looking at the number and saying, well, it's high growth, let's chase it and let's go there. It's really just concentrating all the performance. I think it's important to keep your head down and look for opportunities elsewhere. They're popping up here and there. That's what I'm doing. At the same time I do kind of see that there's a lot of exuberance out there. It's not just on the equity side but I think its gonna start impacting the credit side.

Kathryn Black: What I'm hearing is that there's almost like a desensitization on just the magnitude of the numbers that people are seeing that it's maybe being viewed a little bit differently. This idea of return on capital that people aren't going to be expecting but at what point, what's the timeline associated with that. Then what I've hearing is on the credit side, there's the private credit, private equity side of the coin as well.

Dan Dupont: As much as I love to be super bearish there's not that many issues yet in private credit. I think what really happened was there's a lot of nervousness around software. Everybody's so bullish on AI that they need to be super bearish on software. It's the equivalent of when Elon Musk came out and said, our cars are going to drive themselves at the end of the year. He said that in 2015 so everybody thought, oh, I can buy a Tesla, it's going to drive itself and then I'm going to get revenue from my Tesla Ubering around. With a straight face everybody in the investment business was really worried about this, the fact that there would be no accidents on the road anymore because the cars could talk to each other. We know that typically in good climates accidents go down 80% to 85%, depending on who you ask, when it's self-driving. In 2015 we had these discussions with insurance companies about the viability of their business because if the cars don't have any accidents why would I even insure my car? That's kind of the chicken and the egg at that point. These were hour-long discussions with insurance companies.

Fast forward to today, people are just having these same kind of discussions about a lot of software companies which is fascinating how the investment business is full circle. I manage a long/short fund and in 2021 we made a lot of money shorting, a lot of software companies that were just 30, 40, 50 times sales. The biggest slogan in investing was software is eating the world. You need to be in software. That's where everything is going, they're just destroying every business one after the other. Now AI is destroying software. I used to short a lot of software names and now I'm doing a lot of work and we've added quite a few software companies in the funds. It is full circle. That's what I kind of discuss with the analysts. I try to give them historical examples of things sometimes happen a little slower than we think. They don't necessarily always go in the direction that we think. The winners are not always the companies that we expect.

We'll see with time how things evolve. I own a French company trading at 3 1/2 times earnings, 40% free cash flow yield. Right now the last few quarters have actually been a little bit better because they're using AI because they have a back office and call centre type of business, which sounds horrible relative to AI, but we've seen zero impact yet and at this pace of just raking in the money AI better destroy that business in the next six months because otherwise we're going to double our money.

Kathryn Black: Excellent. You mentioned a couple of things there that we're going to dive into a little bit later but in this whole thesis, when we spoke at VISION back in January you said it was the most offensive that you'd ever been positioned. Does it still stand true today then based on what you're seeing?

Dan Dupont: I was the most defensively positioned, more defensive than the fall of '18, more defensive then the spring of '25. It's still the case today despite all of that movement because of software. In Canadian Large Cap fund I need to be 51% in Canada and sometimes it means I need to buy the least bad ones to fill that quota. With the software additions I did trim some other positions that I didn't like as much. Also outside of that I did trim other companies that did pretty well. I'm still very, very defensively positioned, pretty much the same.

Kathryn Black: So you're very liquid, very able to move, though, if the right opportunities present itself.

Dan Dupont: We can move very quickly, yes, like we did last April. Last April that liquidity was exactly zero.

Kathryn Black: Liberation Day, right?

Dan Dupont: On April 4th, two days after that we were at zero in cash and liquidity. We were fully invested and I was one of the most bullish people in the office. That lasted about four days.

Kathryn Black: That's a long stretch for you.

Dan Dupont: It's pretty long. During COVID I was probably the most bullish guy around for two days.

Kathryn Black: Excellent. That's the beautiful thing, actually, about this new mandate coming out too, Global Concentrated Value, you won't have those constraints of having a set number of Canadian, the 51% that you do in Canadian Large Cap. You're going to be able to make those picks globally.

Dan Dupont: I have been managing a big piece of NorthStar for 15 years so I'm already pretty used to managing global money. I would say the Canadian content in that sleeve in the past 15 years has been 5% to 10% on average. People should expect me to be way, way lower in Canadian content than Large Cap.

Kathryn Black: Excellent. Let's go back to Canadian Large Cap, though, because that's your flagship fund. It's been 15 years, which is excellent. Congratulations. You always say it's like falling out of a basement window, you can't get hurt. It's about winning by not losing. Just talk to us a little bit about the mindset that you have and how you manage that. That crosses over onto your other funds but getting the upside while managing the downside and your thesis and thoughts around that.

Dan Dupont: It comes from a few different angles. Obviously, patience on price is paramount. That's been the most important factor over the last 15 years of my process, letting the market come to us and being extremely patient and concentrating the fund in those few ideas that are really, really cheap but still great businesses, or, hopefully, at least good businesses with good management and good business. We try to have a bit of everything in there. Sometimes you get lucky and there's a general panic about a particular company. Patience on price has been really, really important. Not trying to predict the unpredictable also helps. With the oil price in 2020 when it went negative you let the market come to you. I didn't need to be that smart to be investing significantly in oil and gas at that point. There's a lot of that.

It's not designed to not go down in a calendar year but it just happened that way. If the market goes down 50% one year I'd be glad to be only down 10 or 15 so I would take that down year, absolutely. That's what we're gonna transfer into the global fund as well, focusing on downside, being very, very patient, letting the market come to us, and concentrating. There's gonna be 30 to 60 names, best ideas globally from our research team and very same type of process as Large Cap.

Kathryn Black: Excellent. Your other mandate, Global Value Long/Short, the long process remains the same on the long side, again, that strategy can go more outside of Canada, but on the short side what are you seeing? Right now, are there disconnects in the market that get you excited between pricing, the underlying fundamentals? What's happening on the short side that's making you have a little bit of fun these days?

Dan Dupont: Well, I'm not having a ton of fun on the short side because a lot of themes are just getting more and more exaggerated. I would say I'm very proud of the performance of the Long/Short Fund year-to-date because there were probably 20 different ways to get your face absolutely ripped off. There's so many stocks going straight, straight up for no reason, or reasons that are, yeah, small inflection positively or things are slightly better than expected and they double, or this whole discussion around the bottleneck for the build and the infrastructure in AI. I'm very, very proud of what we've done. We've had to block and tackle but we will take advantage of whatever is exaggerated. Like I said, in 2021 we had a lot of software. The sectors are completely different. There's a lot of crypto back then, a lot of 3D printing. 

Today it's more around the AI infrastructure build at the margin which I try to really focus on shorting really marginal companies, attached to their wagon but are really low quality and massively overpriced. You have quantum computing which is an interesting area as well where they're promising that their computers are gonna be so powerful that it will be able to decrypt pretty much everything, which means that if quantum works Bitcoin goes to zero. There's a lot of people who actually are excited about both which I don't really get, or maybe there's something I'm missing. I am not that smart. These are the areas. There's also these new companies that haven't seen a full cycle, mostly on the financial side, where they're financing deliveries of burritos over eight instalments every two weeks and then they turn around and they securitize that. Unlike the old cycle in '07, '08 where you had some car loans and you had mortgages that were sliced and diced into CLOs, now somewhere in there there's the receivable in June from the payment that Mike did on his delivery of a burrito. It's a really interesting world after 18 years of no credit cycle.

Kathryn Black: CLOs are becoming a lot more flavourful than they once were. There you go.

Dan Dupont: Yes. Well done.

Kathryn Black: Thank you. So interesting. Let's go back to software. I use excited lightly because you don't get very excited about a lot of things but software is an area of interest to you. You were mentioning it earlier. Those of you that have been joining us over the last two days, we saw Jurrien charts yesterday, software is going straight down. A lot of people have said death of software is kind of upon us, you seem to have a different view. The thesis, maybe dive a little bit deeper into what excites you and what you see for that space.

Dan Dupont: If you look long enough at a cycle, again, and everything is full cycle. I bought a whole lot of Microsoft, I think 2011, at a 9% free cash flow yield when everybody thought it was just a dead company. You look at what's happening now the Mag-7, they're trading at 1.4% free cash flow yield. For me to get interested in them as a group I would need to see at least 3 1/2, maybe 4% so they need to go down 60, 65%, which sounds completely egregious but a lot of software companies are down 40, 50, 60% year-to-date. We see a lot of stocks just go straight down with no buyer because everything has changed. Everything is algorithmic, everything is passive. Value oriented long-only investors are few and far between in this market. A lot of them have basically gotten pushed out of the business. I don't know many of them left around.

Kathryn Black: You may be the last man standing one day.

Dan Dupont: Well, I hope not because I need people to sell to but I guess I need to wait for my stocks to become growth names. It went straight down and it gave us an opportunity to make it a really large position. I'm more patient than I was ten years ago, obviously. Like I said, you can't really buy a cheap stock just because it's cheap and sell it to somebody who will pay more for it.

Kathryn Black: Sticking on just some themes that you're interested in, you did talk about the yen. We don't typically talk about currency but you are seeing some opportunities within Canadian Large Cap in how to capitalize on what's happening over in Japan [crosstalk].

Dan Dupont: I'm always thinking about what would be a free call option in the market. I mean, several years ago one of the ways that I invested was I saw that defence companies were really cheap and I thought about the upside. If something geopolitically happened and the market goes down this is actually going to go up. Then Russia invaded Ukraine all of a sudden. A few people told me that I was lucky. Yes, there's luck involved but there's also a lot of thinking that goes behind what I'm buying and how we're trying to look for upside and downside protection. You look at where we are today ... I'm going to get to the yen. Stay with me here.

Kathryn Black: I trust you.

Dan Dupont: It's going to happen but we need to go through a few steps here. The first one is where's inflation, inflation expectations? Everyone's thinking inflation is going to be higher, inflation's high. What could really upset that? We've seen inflation expectations for the full year go from something like 2.75 to 3 1/4 in the last month, whereas if you're trying to buy a US government bond for a 1-year T-bill you're going to make 50 basis points real, so 3.75. What if what we discussed about financing eventually stumbles a little bit, there's more volatility, the AI story starts spinning a little bit in the mud, nothing too, too bad but what if the global economy slows down somewhat, and then you look at the CPI in the US, a third of it is housing, and housing in the US is not really doing well at all. Owner equivalent rent is pricing in +3 or something, house prices are going down mid single digits.

At some point in the next year if all this comes together maybe inflation is a little lower, who knows? There's nobody that's pricing for that, let me just say that point. How do you protect against the global economy slowing down and volatility spiking? Well, historically you would have looked at gold, possibly. When I bought gold in 2004, personally, you had to have it delivered to your house. I had 10 ounces shipped for $4,000 to my house, put it in my pocket, took the subway down, put it in a safety deposit box downtown Boston at Fleet Bank, paid for the safety deposit. It was complicated. You could not lever it up whereas now there's a giant ETF. Gold is being used in cryptocurrency realms through stablecoins. Tether has $27 billion in gold to start. Whenever you can lever something that's been financialized it reduces your diversification benefits. I think gold has proven in the last month or two that it has become way more correlated with other assets.

When volatility spikes correlations go to 1 in anything that people can sell.  I think gold is gonna be something that people can sell a bit better than in previous cycles. I'm not as interested in gold. It's gone up massively. If you look at the correlation between real rates in the US and gold it's very, very tight, typically, but now central banks have been buying aggressively. Again, I'm trying to predict the unpredictable here. Gold could go down massively if central banks stop buying. It might double again, I don't know, but I'm just staying on the sidelines there. Where else can we look? When I was running the Gold Fund 2003 to 2007 the four currencies that were kind of defensive that were risk-off was the US dollar, the Swiss franc, the yen, and gold, because gold is a currency. It trades like a currency, the forward curve is exactly like a currency. Swiss Bank just basically sold all of its gold and the budget deficit's pretty big so that's out of the question. US dollar did not do that well last April as it had done historically in periods of volatility so maybe it's still a place where you can diversify a little bit and do decently well in a spike in volatility.

The real one, the central one, the one that I don't think many people think about is the yen. The yen, not only is it kind of a risk-off currency but it's been used, and now abused, as basically a funding currency to invest anywhere else around the world, whether it's highly speculative or for income or any of those things. We've seen the yen go down pretty much every week for the past few years. It's really just used as a funding currency. The Bank of Japan has tried to intervene in the last week and it's kind of worked but not really. They're spending a lot of money trying to protect their currency. At some point what they're gonna have to do there is to raise rates, and the day that they raise rates in Japan that might be a little bit of a volatile day in capital markets. We know whenever the yen moves dramatically it does tend to have waves around the world, again, because it's central to all of that funding structure in capital markets. That's one place I would look, is Japan.

Kathryn Black: Something on your watch list.

Dan Dupont: You might see in the holdings in Canadian Large Cap Fund a few percentage points in something called the JGB, which is the Japanese government bond.

Kathryn Black: Understood. Great. You had mentioned inflation there and just the growth of the last three months going from 2.75 to 3.25. We heard from Jurrien's presentation yesterday equities and bonds are now more positively correlated than traditionally [indecipherable]. The 60/40 he views as a 60/20/20. Maybe in that alternative space of the 20 where does that fit in? What are your views on that, and is there a place for Global Value Long/Short, perhaps.

Dan Dupont: I think my view is a little different because I think about downside and volatility a little bit differently. I think bonds have been dismissed a little too much. I think it's been basically a widow-maker for years and years. People have lost a lot of money in bonds. I've had a few people tell me, well, I don't invest in bonds, I just buy Canadian Large Cap Fund. Sure, but if the market goes down 50% and rates actually go down I think you're going to be better off in a US T-bill or US bond or a JGB. That's kind of the way I see the world. I'm trying to be a little bit different on that perspective. That 20% in alternative assets in my view, may be slightly cynical but it's really a lot of repackaging of risks that already exist in assets.

Kathryn Black: Diversifiers, yeah.

Dan Dupont: Well, I guess so but eventually people just lever up everything that they buy so yes, maybe slight diversifiers but I think when risk comes around correlations go to 1 and I think it'll include a lot of alternatives. The ones that are not liquid will get hit pretty quickly. What happened in private credit is pretty obvious. If people were nervous about software they went to their private equity funds. I don't want to mock any pension fund managers but they'll invest in a private equity fund and you're stuck there for seven years, so now they hear that, oh, maybe software is doing badly, it's gonna get pretty tough so they look at that fund, they can't redeem it so you're gonna go to the other place where you put money, which is private credit, which is lower risk and therefore doesn't have those restrictions of seven, eight, nine years. But then if enough people do that then the gates get pulled up and then you can't get your money out.

I guess the other thing that's interesting about private equity, private credit, I was in Winnipeg presenting and I listened to Adam talk about private equity. He did state that, well, it's a $2 trillion kind of asset class but there's only a trillion dollar invested. It's not two, there's a trillion invested. The other trillion is just capital calls when required. As a glass half empty kind of guy, and I remember '08, that trillion dollars, that spread between what's invested and what can be called is a problem, because once things unravel every fund will pull the capital and therefore we had funds that were well respected in '08 who basically decided not to send the money to their private equity funds because they had way too many other requirements, including their pensioners. They basically illegally did not send the money that they were supposed to send. That makes me, you know, that doesn't make me as comfortable, I guess, as other people would get from that.

Kathryn Black: We have only about six minutes left, this time is burning up on us. Let's go to a few more sectors, maybe around the world a bit. The Canadian economy has been evolving, has been different sectors that people are feeling more bullish, if you will, on, would love your just thoughts if we talk about commodities.

Dan Dupont: Andrew said earlier he's very constructive on the Canadian economy. There's a lot of great things going our way. For me, being more of a valuation-centric investor ... I've said historically, if you buy the banks at 1.1 times book, you sell them at 1.8 you're going to do pretty well if you only want to spend a minute a year. The banks are currently 2.2, 2.3 times book. National Bank's 2.5 times book with 10% of income from Cambodia. This is where we are in the cycle. I'm not there. I have zero banks. We made a lot of money in TD and Scotia last year and now we're out in Large Cap. That's one area we're not. Insurers, massively geared to interest rates and asset prices on the two sides of the balance sheet. Rates are pretty good and asset prices are pretty good, and the multiples are actually pretty expensive too. I'm not there. Oil and gas, we owned a lot in 2020. I went from 0 to 30% back to 0 so I'm not really there. Base metals, I'm not there because, again, these companies are trading ... the commodities themselves have done really well and the companies are trading at two, three, four times book value. Time is not your friend when your return on capital is pretty low so we'll see. They might do okay but I'm not gonna predict that. We're pretty far in the innings.

Where do I invest? It brings me back to the core of what we own. Some core holdings are still pretty sizable, the Metros, the Couche-Tards, and now software which is probably the highest software exposure I've ever had. A lot of Constellation, CGI went up in exposure and OpenText. Outside of that, Canadian Telecom is still a place where we have some money. We went from a three to four player market and the balance sheets are not perfect so people are really kind of nervous about that, and dividend cuts and all that which, you know, sometimes they'll just postpone for no reason which ends up hurting everybody. They should just get it over with and do it. That's where I am. I'm just owning what I think is the least bad in Canada. The software wobble a few months ago was really helpful.

Kathryn Black: Excellent. If we look outside of Canada, maybe we'll start with the US first, just wear head's at on the US environment and opportunities.

Dan Dupont: US I wasn't really there but now with the divergences happening, you know, healthcare has been horrible so I'm looking more and more there, and looked aggressively at software and we found quite a few names there, both in Large Cap but mostly in my global sleeve of NorthStar. You'll see a lot of software exposure in the new fund that we launch. There's a lot of interesting things happening there and great valuation. Didn't think I would ever be that excited about software but here we are. Outside of that, the same areas are still really attractive to me. Tobacco, I come in every day I can't believe how cheap they are. Growth is actually inflecting up, they're between 9 and 11 times earnings, huge dividends, great balance sheets. It's a no lose situation. They're buying back shares and they know how to run their business so well because nobody goes to work for a tobacco company to just not really just make a lot of money and try to make the stock price go up.

Kathryn Black: That's on the international side and spirits are still a hold in that.

Dan Dupont: Spirits are still big in the holdings there which we started building a year, year and a half ago. It's still really tough. The inventory overhang is still pretty large but I think coming out of this we will be really large shareholders in companies that are amazing businesses, amazing brands. Maybe they've done a few bad mistakes in the last few years through COVID and after but I think they're riding the ship.

Kathryn Black: Excellent. We'd be remiss if we didn't talk about merger arbitrage because I would say you were one of the more active managers in that space. You've done 600 deals over your tenure. Just talk to us about what you're seeing in the landscape. Is that going to play a big part in the new fund? You said you're 29% earlier so clearly active. What are you seeing and is that still a process that you're going to [crosstalk]?

Dan Dupont: I have participated in over 600 deals in the last 15 years. It's helpful for me because I get a feel for what's happening in capital markets from that angle. You can look at spreads, you can look at VIX, you can look at the different kinds of things but that's an additional way to look at markets. For me, it is a tool that I use. If you add cash and a little bit of bonds but mostly arbitrage Large Cap is at 29% liquidity. Last April, April 4th, we were at 0. We had 0, we we're fully, fully invested. It really depends which way the market is going, the opportunities that the market brings us. It's a great place to compound. You make a return that's not crazy high. You should think of arbitrage as a small spread to T-bills so maybe something like 7% right now, which is not bad at all as you're waiting for stocks to come your way. Hopefully, more of a software type volatility, maybe more opportunities in healthcare. We don't really need the market to implode. We need just some wobbles here and there. If the whole market comes way back down we will have way more opportunities, possibly, and redeploy that. I'm ready to deploy that very, very quickly. Last April 4th we did over a billion dollars in a day. We did a lot overnight in Asia, did a whole lot overnight in Europe as well. We're ready to move. Sometimes we'll sit on our hands.  I love the saying, there's decades where nothing happens, there's weeks where decades happen. We had one of those last April for us and, hopefully, there's another one in the cards for the next year or two somewhere.

Kathryn Black: The weeks when decades happen you have lots of experience in pulling the trigger and making those moves when necessary.

Dan Dupont: And I have so much fun.

Kathryn Black: And you have so much fun, which is so important. Just to wrap up, Global Concentrated Value, it's coming May 20th. What are you most excited about with that new mandate?

Dan Dupont: The exciting part is that I can buy more names globally. Some of the stocks that have not been seen in Canadian Large Cap Fund that can protect us better, have a better return, cheaper, we can do a bit more of that. It's exciting. It's my own kind of extreme end of the spectrum. You have Global Innovators on one end of the extreme spectrum and then you'll have me at the other end of the spectrum with my global offering. Large Cap 15 years and let's see what this one can do for the next 15 years as well.

Kathryn Black: Love that. Thank you, Dan. Thank you for being with us today.