Eric Sprott certainly has good timing. The news that the investment firm that bears his name, Sprott Asset Management, is planning to go public with a $200-million offering comes at a time when Mr. Sprott is in fine form, winning accolades for the returns he has delivered to investors over the years.
Those returns are stunning when compared to the benchmark index or his Canadian peers: His Sprott Canadian equity fund has returned an average of 28 per cent a year over the past 10 years, putting it top of its class. But the returns are downright eye-popping from an international perspective because of the truly vast number of funds he is up against in the rankings.
According to Morningstar Canada, the Sprott Canadian equity fund ranks No. 36 among 105,000 equity funds around the world, in its 10-year performance. What makes the ranking even more impressive, if you're still shrugging your shoulders, is that most of the funds above his are specific funds that have targeted exceptionally hot areas of the market, such as emerging markets.
Mr. Sprott himself has often been criticized for taking a far too narrow approach to investing. In his case, he has focused his assets on specific sectors - most recently resources.
However, what makes him stand out among his global peers is that his mandate is not narrow: He chooses to invest in resources because he sees the greatest source of returns there. He is not beholden to them.
Global infatuation with emerging markets or resources may come and go, just as the infatuation with technology stocks came and went nearly a decade ago. Mutual fund investors who admire Mr. Sprott, and presumably equity investors who buy his firm's shares after the initial public offering, see a far more long-lasting quality.
That is, until Mr. Sprott retires or his flagship fund hits a soft patch. Mr. Sprott is 63; over the past three months (to the end of February) his fund is up 12.4 per cent.