E39: Small-Cap Equities with Jordan Zinberg

This podcast is brought to you by Ginsler Wealth. The information discussed today is meant to be general in nature and not tailored to your specific investing circumstances. This means that you should talk to your regular Gensler wealth advisor or your own advisor before acting on any information we discussed today. Nothing in this podcast is intended to be a solicitation and past performance does not guarantee future returns. Today we're talking about a volatile asset class, so buckle up for a potential bumpy ride. Today on the Unlimited podcast we speak with Jordan Zinberg, President and CEO of Bedford Park Capital, a small cap equity investment firm. What is small cap investing and why is it an attractive opportunity if you have the skill set to do it? Let's find out. Let's go. Well, welcome everybody to the Unlimited podcast. You know, I look back on a number of the episodes we've done actually all of 2024, and I realized a few weeks ago that we hadn't really done anything very specifically on the investing side so far this year. The last one we did was the State of Real Estate with Rob Coomer in December of last year, which by the way is one of the most listened to episodes. And if you like real estate, you should go listen to it. But We've covered insurance 101. Insurance 201. We've covered luxury cars. We covered the new federal budget announcements from last month, but as I say, not really a pure investment focused episode. So I thought it might be a good idea A to do that and B to bring my my friend Jordan Zinberg from Bedford Park Capital to talk to us about small cap equity investing, which is an interesting and active sort of way to invest in equities that may be a little bit different than what some folks are familiar with or some folks are doing in their portfolio. So Jordan is here. Jordan, thanks so much for joining us today. Looking forward to this.

Yeah, thank you so much for having me, Brian.

No problem. So let me give a quick intro to Jordan and then and a little bit about his fund, but of course he'll dive in much deeper for us. So Jordan's the President and CEO of Bedford Park Capital Corporation. Jordan has over 20 years of investment industry experience and has served as a director of both private and public companies. Before founding Bedford Park, Jordan was a Managing director and Portfolio manager at a prominent Toronto based investment management firm and prior to that spent seven years at one of Canada's largest investment dealers. We'll leave the rest of the bio for the show notes, but lots of certifications and accreditations and why are we talking to Jordan? In addition to being a very smart and nice person, he has run a very, very successful firm. I would say, based on our sort of sources of information, Bedford is currently one of or potentially the best performing fund in Canada this year, up almost 40% so far this year. Looking longer term, which to us is more important, Jordan has generated an almost 15% annualized return over the past five years, putting his fund near the top of the list of best performing funds over that time frame as well. So someone who I think knows what they're doing, full disclosure, we do invest with Jordan and Bedford Park. We do have some of our clients, where applicable and appropriate, in Jordan's fund. So there's a caveat there. But yeah, excited Jordan to dive in a little deeper and learn what small cap investing is all about.

Great.

So I've given a little bit of your background before we jump into what is small cap investing. We always like to do a 101 because we're not quite sure you know, what our listeners know. But can you give a little bit more of a background on you and how did you get from wherever, you know, wherever your life started through to running Bedford and what was the journey and you know, maybe why you're doing this as opposed to some other type of investing.

You know, when I think about the journey, I think it probably really started for me when I was 11 or 12. And Brian, we're around the same age, so I think you remember at the time baseball cards was, was really popular trading baseball cards. And, and my first exposure was, was really seeing how a market worked because as I reflect on it now later in life, I realized that, you know, a lot of the things I was doing back then are pretty similar to what I do now. I was buying, I was selling, I was following the market prices, I was making judgments and observations about those prices and ultimately trying to upgrade the quality of my collection. And now I spend my days doing a lot of the same things, except I'm doing it with companies instead of baseball cards. In my early teens, I got a gift of some stock from an aunt and uncle and that was really where my passion for the stock market came. So I invested in stocks throughout my teens and I had a lot of different part time jobs growing up. So I think by the time I got to studying business in university, I had a pretty good idea about how companies worked or a better idea than most kids my age. And I knew at a fairly young age that I wanted to ultimately pursue a career in investing. And in finance. So I got an MBA in finance and I wanted to go work on Wall street. But unfortunately I graduated right around the time of 911 and Wall street firms were firing people, they weren't bringing 24 year old kids with no experience in from Canada. I stayed here in Toronto and I took the first finance job I could get, which was as a retail broker at one of the large bank owned brokerage firms. And I really enjoyed my time there and I learned a lot. But as I got into my late twenties, I realized that I wasn't going to be happy working for a large financial company for my entire career. I wanted to do something more entrepreneurial, you know. I also realized that the part of the market that excited me the most was not really blue chip stocks or large cap stocks that most investors focus on, but rather it was the smaller, fast growing companies where I could really have a chance to outperform the market. I decided to move on to the next phase of my career and I was really fortunate to land a role at a small hedge fund that focused on Canadian small and mid cap growth stocks. And the firm was launched about a year before I joined and I was the first hire other than the two co founders. So I was really lucky because I got to work really closely with the founder and he'd been an award winning analyst, research analyst earlier in his career. So because it was such a small firm and I was there at the beginning, I wore a lot of hats. I was the analyst, I was the trader, I was the business development person as well. So I spent most of my 30s there and we were really successful, we produced really strong returns for our investors. And the fund grew from about 13 million when I joined to about 400 million at its peak. And when I was there, I progressed over time. I became a port portfolio manager as well as the firm's head trader. And I learned a lot and did well financially. But ultimately my goal was to start my own investment firm. And as I got closer to 40, I realized it was kind of now or never. And I'm. I'm constantly encouraging my kids to follow their dreams and pursue their goals. So I kind of followed my own advice and in 2018 I started Bedford Park Capital together with my business partner, Todd Zaligman.

Nice. Sounds like a little bit of a familiar story. I also thought it was now or never for me, but that was three years ago and a little bit later than 40 for me. But, but we're both rolling so that's good. You used a few. This I Want to go into a little bit of small cap 101, and you've used the term small cap and mid cap and this and that. Let's assume that not everybody even knows what quote unquote cap means and go back to basics. So first of all, there's passive investing, there's active investing, there's as you say, large capitalization or market capitalization stocks. There's blue chips out there. Can you just give people a little bit of lay of the land of what? You know, this could go on for four hours if we really go deeply. But what different types of investing in the equity markets are there? What do these things small mid cap mean? Let's, let's start there as just a little bit of a 101 for folks, because that'll guide the conversation throughout.

Sure. So when I'm talking about small or mid or large cap stocks, I'm referring to the size of the company. And there's really no universal definitions in terms of small and mid cap and so on. Although in Canada, I'd say a small cap is probably 100 million to 2 billion. So that, that's the total market value of the company. To me, a mid cap would be probably 2 billion to 10 billion. And then over 10 billion would be considered a large cap stock. If we were in the US the companies are bigger, so those, those numbers would probably shift upward slightly. But, but that's what we're talking about. We're talking about the overall size or market value of the company. Now, in terms of investment options, I mean, investors today have more options than ever. As you know, Brian, on one end of the spectrum, we have what they call passive investing, which basically allows investors to easily get exposure to an index or a diversified basket of stocks or to a specific market or to a specific sector. And they can do that at a really low cost. And then they can oftentimes even do that themselves on their smartphone. Whether or not that's a good idea, we can talk about a bit later on.

Right.

And then, you know, as we move away from, from what they, what they call passive investing, we get into what they call active investing. And active investing is when you have an investor who could be a portfolio manager like myself, or just an individual, and they're making buy and sell decisions on specific securities, or they're trying to construct a portfolio that attempts to accomplish a specific goal. For many investors, that goal is often trying to outperform an index. So you could go buy the tsx, for example, and get that exposure very cheaply. Or you could hire a manager who's trying to select from that same universe of Canadian stocks. Yet they're trying to outperform that index. And in terms of trying to outperform indexes, there's, there's several different ways to do that. There's a lot of different approaches within the market. And in my particular case, I choose to focus on smaller companies, but I'm actually the minority, I mean, among most active equity investors, most of them will focus their time and effort on, on large cap stocks. So these are blue chip companies that are very familiar to them. Analysts would regularly publish reports and financial forecasts on these companies. So with larger companies, the, the research process is much easier. The second thing is that larger companies tend to be more liquid, so they're easier to trade, they're easier to get in and out of. And in particular for investors who manage large pools of capital, say billions of dollars, oftentimes they're somewhat restricted by their size or their mandate in that they really only can buy larger companies. So there's a number of reasons why most investors are looking only at large cap stocks, but therein lies the opportunity. Because if most investors are focused on large cap stocks, that lack of investor attention on smaller companies can create tremendous opportunities for investors who know what they're looking for and who know what they're doing. This is the segment of the market that I get excited about. It's where I spend most of my time and energy. I think that's where we're able to go in and find companies early in their life cycle that others may not be looking for, either because they can't, they're too big, or they won't because they just don't have the expertise.

Yeah, I mean, I think you think about it for folks that aren't again, in our world all day, every day. You know, you turn on the news any day. You can read about Tesla, Amazon, Netflix, Google, Facebook, Nvidia. There's so much news and so much content and material about these big companies that everyone is familiar with. I guess what you're saying is in the small cap world, they are maybe, I guess, less known, less followed, less understood. Like what, what are the characteristics of small cap stocks that help you, you know, achieve what you're trying to achieve? And, and whether it's outperforming something or not, I always think of it as just trying to do a good job, reasonable returns for the risk you're taking. In my view, it's not always about outperforming some passive index not, not that you said that, but just as a, as a, as a matter of a statement. But yeah, like what are the characteristics that, you know, you think make this, make this attractive for you?

Excellent points, Brian. You know, with respect to the companies you mentioned, if I told you that I was buying Royal bank and Shopify, we probably wouldn't be having this conversation because you wouldn't need me to be picking those stocks. So where investors use us and where they find us beneficial to their portfolios is going and exploring the corners of the market that they're really not active in and getting exposure to companies that they're probably not seeing. So in terms of why I'm attracted to small caps in particular, there's a number of reasons, but the main reason and the cornerstone of everything we do is that smaller companies tend to grow faster than larger companies. And if they didn't grow faster, quite frankly, there wouldn't be really a reason to buy them because I'd much rather have a bigger, more stable, liquid company if I'm getting the same growth. When I'm looking at smaller companies, I'm always looking for companies that have above average rates of growth. So if you think about the average company on the TSX, it probably has about an 8 to 10% growth rate. I'm looking for double that. I'm looking for companies that are going to give me a consistent rate of growth of approximately 20%. And again, I don't want that just 20% one year and then slips to 4% the next year. I'm looking for companies that are going to give me that high consistent growth rate. And whenever I talk about that, everyone says, well, you know, everybody wants those companies, so they're probably expensive. But the nice thing about smaller companies is we're able to find those high growth opportunities that for one reason or another, don't have premium valuations. And the reason they don't have premium valuations could be that they're not very well known, or perhaps they're just not liquid enough for larger investors, or perhaps they're in an industry that's either misunderstood or out of favor. So there's a number of reasons why, but at a very high level, the main reason I'm attracted to these companies is I'm getting higher growth rate at better valuation. Now, in addition to that, there's a number of other benefits, namely things like better access to management. So if I want to meet with the CEO of a small cap company, depending on its size, they're usually very happy to hear from me. Whereas if you go try to meet the CEO of Amazon, I don't think you're going to have the same type of luck. Better access to management is key because it gives us a much better understanding of the jockey who's running the company and allows us to build a relationship with the person who's actually making the decisions at the company on a day to day basis. And we speak to them quite regularly. So for us, that's a big advantage within the small cap universe. And then the second thing is, because there are much fewer eyeballs on these stocks, there's a much higher probability of those stocks being mispriced. When you put all of it together, we have higher growth, better valuations, better access to management and a higher probability of mispricing. So for me, those are some of the key components of why we can earn higher returns in the small cap market.

Okay, and that sounds like a whole bunch of very positive things about investing in this area. For sure, there's probably some challenges and things to pitfalls, things to watch out for, but we'll get to that in one second. So given all that and given the opportunity and given these are not stocks that, you know, tons of information is out there and all that, what does it take to be successful as a small cap investment manager or investor and maybe as a connection to that is. And how do you find these companies? I mean, I know they're public companies, they're out there, but how do you pinpoint and how do you really, you know, figure out which ones you know meet your criteria?

So let's start with the first part of your question, which is, which is what you need to be successful in this market. And I think it's an astute question because the skill set for a small cap manager is similar, but yet quite a bit different than what you might see from somebody who focus is on larger companies. It really falls into probably three main areas. So how you source your ideas, how you evaluate your ideas, and then how you ultimately execute once you decide you want to buy or sell something. In terms of sourcing ideas, it's not something that large cap investors typically have to think about because these larger companies are already well known to investors and there's tons of analyst reports and financial forecasts and consensus and things that they can rely on when they're trying to make their judgments. Even things like information on the industry and competitors to the company is readily available with large caps. But with smaller companies, this usually isn't the case. We need to source our ideas on our own. And there's various tactics we use in order to do that. I think your reputation and your contact network become way more important as a small cap manager than as a large cap manager. And that's another reason why we specialize here in Canada. We have that nice home court advantage for Canadian stocks. And I think it's a big advantage. I think if you asked me to do everything that I'm doing now, but to do it in a different market, it wouldn't be anywhere near as effective. So I think we have a real edge when it comes to finding that next great Canadian business. Now, in terms of how we evaluate the ideas, there's, there's also some different skills because when there's not as much information available, we need to be able to diligence ideas on our own. So sometimes there's little to no analyst coverage. And on top of that, we're dealing with companies that are growing and changing very quickly. So in terms of accurately forecasting the financials, that becomes more difficult. If you have a big established company that grows at 5% a year, year in, year out, it's pretty easy to forecast next year. But when you have a company that's maybe doubling or tripling their revenue, but then maybe they have one year where they need to invest a lot of money, I mean, there's constantly changing things you need to think about as, as you're evaluating those companies. So evaluating the ideas is slightly different as well. And then the last piece, the trading execution piece, is not talked about very often with investors who invest in larger companies because anytime they want to buy or sell, the stocks are very liquid and they can go and do that. But in our corner of the market, it's a really important part of the process because there's no point in finding an outstanding opportunity if you can't go and buy the stock. For a small cap manager to be successful, you need to know how and where to source stock when you want to buy it, and how and where to source liquidity when you want to sell it. Someone by any of these larger names doesn't have to think about that. But as a small cap manager scales, your reputation, your trading ability, your industry connections, all of those things, your overall skill level on the trading execution side is very, very important.

And so, so just a little bit more color on that last point, just so folks understand why, if I can go buy a big large cap stock any day, lots of stock out there, whatever, why is that not as easy with small cap stocks? Is it just because it's A smaller market cap. So there's not as many shares trading, or there's. There's lot, you know, large positions that are illiquid because they're owned by the owner or the CEO or something. Can you give a little bit of color about why getting shares to trade is complicated?

It's a combination of a bunch of things that you just mentioned. But let's think of an example of, of a smaller company where the founder is still running the business and might own. In our case, we have. We have companies where the founder owns 50% of the company. So when you think about, let's say there's a small share count, let's say there's, you know, 10 million shares outstanding. Just for simplicity, the founder owns 5 million shares, then you might have a few early investors who each own 10 or 15 or 20% of the company, so they might own another couple million shares. So while this is a simplistic example and most companies have more than 10 million shares outstanding, in this case you might see a scenario where there's really only 2 or 3 million shares that are available for everybody. As a manager who wants to come in and maybe buy 500,000 or a million of those shares, you need to know where those shares are, which brokers you need to speak to in terms of them being able to source stock for you if, if there is stock available.

And I guess that also means then if there's, you know, it's a supply and demand thing. If there's less shares available to be bought or sold at any point in time, if things start getting exciting and the company starts doing well, does the stock move higher quicker or conversely, move lower quicker? Because there's not a lot of shares trading. So you have to offer, you know, a higher price to get it off someone, or you have to sell it at a lower price, you know, to get out of it if you want. If you know what I'm getting at

here, that's absolutely correct. And that's where part of the skill that I'm referring to comes in. Because sometimes you want to be buying quietly. So if I'm looking to buy stock in a company and I don't want anyone to know, I might just buy small amounts over. Over multiple days, or if I'm lucky enough to find a block, I could find a block of stock and make a larger purchase. But, you know, there's a strategic element to it, too. I may not want to call a broker and tell them I'm looking for a million shares of stock. Often, you Know you need to be strategic in your approach. And again, for investors who are looking primarily at larger, more liquid stocks, this isn't really a consideration for them.

Gotcha. And let's just talk about, go back to talking about some of the positive aspects of investing in this, in this, call it an asset class or sub asset class. But there is some considerations or risk here. It can be volatile. You're pursuing higher returns, you know, and with the pursuit of higher returns comes higher volatility. As I always explain to our clients, in the last five calendar years the returns of your fund have been, you know, some years up 30%. Luckily more years than not up 30% but also one year down, close to 30%. And this year you're up already at the end of the, sort of at the end of April, let's just say up 40% or so. Like lots of volatility, lots of ups and downs. First of all, maybe explain some of that, some of that, the risk around small cap investing. And then B, who is this type of strategy suitable for at a high level?

Let's start with, with your first question, which is some of the negative things and ironically a lot of the negative things that I'm going to talk about are actually positive things that create opportunity for us. But the common conception with small cap stocks is that they're more volatile and that's a hundred percent true. They are more volatile. That can scare a lot of people. For those who are level headed and have done their work on the companies, that volatility can create opportunities. So let's look at an example of that. Let's say I come in one day and the market opens and one of my stocks is down 10%. And I look around and I see there's nothing fundamental, there's no news out. I might make a few calls to see if anyone's heard anything. If I'm satisfied that there's no fundamental reason that that Stock's down for 10%. It could just be something as simple as what you alluded to in your previous comment, that there's a seller who wants to sell the stock and they're either selling it in a sloppy way or maybe they just need to get off today for whatever the reason is. So I might be able to go in and buy that stock that morning. And I can tell you with, with a high degree of confidence the company is not worth 10% less than it was the day before. So despite volatility being scary for some, it actually creates a lot of opportunity. The second piece is liquidity and we've talked about this a little bit already, but these stocks are not highly liquid. Now, liquidity is something that I think is overvalued in most investor portfolios, and it's actually costing them a lot more than they realize in their portfolio. Because unless you need to transact on a daily or regular basis, liquidity is not that as important as it might seem. Sure, it feels good to be able to sell your stock any day and be off your portfolio in three minutes if you want to be, but if you're not actually trading that way, liquidity is quite expensive in your portfolio. Most investors don't view it that way, but they should. So again, the fact that stocks in our universe may be less liquid creates opportunity for us and is one of the reasons why we're getting these stocks on lower valuations, especially when they're, they're earlier in their life cycle. But given that we're a relatively small fund, liquidity hasn't been a major issue for us up until now. In terms of other negatives, things we've already talked about. So, lack of research coverage, lack of estimates, and then I think with small caps, and again, probably rightly so, there's a perception that, that a lot of the companies are in fact bad companies, and there are a lot of bad companies out there, but there's also a lot of really good companies out there. So those that have a way to systematically go through those companies and judge which ones are worthy potentially of investment. Again, it's, it's a negative on small caps in general. It's a positive for those who know how to leverage that into making money. So for many people, some of the things we just talked about would be reasons not to invest in this market. For me, that's, those are some of the reasons exactly why I want to be here, because those are creating the ability to earn those 30 and 40% returns in a year for our investors that, that you mentioned.

Right. I like that. It's, that's like when they asked you in an interview, what's your worst, you know, quality? And you think, well, I, I, I work too hard. I'm a workaholic. Take the negative, make it a positive.

I love it.

Okay.

You're not, you're not, Brian. You're not spinning it if it's the truth.

I'm with you. I'm with you. So, okay, good. So we've covered what small cap investing is. We covered the pluses, the minuses, how you find companies, how you trade. So let's actually Get a little bit of example, maybe one, maybe two. You know, I like to, you know, in my office on the side, I have a tv, I've got BNN on most of the time, unless there's some sort of tennis tournament on. So I watch bnn and every once in a while I get to watch you pop up in my office on the screen. You are a fixture on bnn. I guess they like talking to you and you do a great job there. And by the way, I want to ask you some questions about behind the scenes at bnn, because I'm always intrigued as to what actually goes on there. But we'll do that in a minute. They always ask you for your top holdings and you answer questions. Can you give us an example of one of the companies you hold? Maybe your top holding, maybe just the name you think would be instructive to explain, you know, your process and how you do your, how you've been successful company, how did you find it, how do you sort of get invested in it and sort of why is it good and what's happened.

Sure. Let's talk about Propel holdings, which is a company based here in Toronto. I'll give you a bit of my history with the company and maybe talk about how things have played out. We've held it for about three years now. So in terms of how we found the company, they did go public on the TSX late 2021. A few months before that, I got two independent calls from people I trust who said, there's a company coming public. It's called Propel Holdings. I know what you like to look at, Jordan. You're going to love this company. You should start reading up whatever you can and start getting up to speed because it's going to be coming public in a few months. And in fact, one of the people who called me knew a member of the management team and was able to get me a call with management ahead of the ipo. So I was able to start my research process a little early, which is great. This again goes back to what we were talking about earlier with respect to home court advantage and why I like investing in Canada exclusively. So that's how the idea came, came about in terms of how we diligence that, you know, we met with management early on, got a pretty deep understanding of the business in this case. Propel is an online lending business and for those who are familiar with me or my fund, you'll know that lending happens to be one of our sort of areas of expertise at our firm. We've invested in that sector quite successfully and, and believe it's a very good place to go hunting in Canada simply because of our market structure. There's, there's a lot of exposure in Canadian portfolios to the large banks and insurance companies. And as a result of that there are a lot of smaller non bank financial firms that are really good, high quality companies that just don't get a lot of love from investors because of our market structure here. So it's a sector we like to go hunting in. Met with management, did a bunch of diligence. I can't say our investment process or research process in this case was that unique. We read whatever publicly available information there was prior to the ipo. We participated in the ipo. The stock did pretty well out of the gates and then we got into a weaker equity market in 2022 and the stock sold off. So I think the IPO was at 975 a share. It got up to about $14 I think before the market turned. And then once the market turned, the stock went down to $6. And that's where things got really interesting because at that point on my numbers we were able to buy the stock at, I believe it was three times earnings at the time, three times forward earnings. So I was sitting here looking at a company that had been doubling their profits every year, so growing their profits at 100%. And I was now able to buy this stock on 3 times earnings. And by the way, it also had a 6% dividend yield at the time. So this, to me, this setup was the perfect pitch. We had a really fast growing company in a sector that is not usually very well loved and kind of misunderstood. In Canada. We were able to buy the stock extremely cheap and we were getting a yield. So it really had something for everyone. So we bought as much stock as we could between that sort of $6 and $7 range. And by last fall the company had done a fantastic job executing. They had put up several great quarters. They were going out and telling their story. Investors started finally coming around and typical small cap Canada, nobody wants a stock and then all of a sudden everybody wants a stock. And we had been buying, like I said, in that 6$7 range. And the stock just really started to move. And actually recently, a few weeks ago, I hit $30. You know, there's a great example of getting in on a company early, getting up to speed, really getting sort of some, some deep knowledge over several quarters and then being there when other investors realize what we had seen but don't get me wrong, Brian, I mean, when I was sitting there at 6 or $7 thinking that this was a fantastic opportunity, yet nobody else other than me seems to want to buy the stock. And I have brokers calling me every day offering me stock. I mean, you definitely need to be confident in your own ideas to be able to stand there and be buying stock when no one else seems to want to.

Right.

Wow.

Good. That's a, that's a big return. Hopefully it continues to go that way and, and do well for you and your investors. So that was what, six times? Sorry. I know. I assume you're still holding it so that, let's call it six times that low that you were buying it at.

Well, the interest of full disclosure, our average cost on the stock is about $8 and it has come off that $30 level. It's sitting around $24 right now as, as we're here talking.

Okay, all right, that's good. So just for fun, like what's, what's been the biggest home run in, in your history there, whether you go into all the details or not, just from a sort of return perspective, biggest return

I've ever had as an investor, you is earning a hundred times my money. That's over more than a 10 year period. So, so I've held the stock for a very long time, but it was my first hundred bagger, as they like to call them. Since starting the fund five years ago, we've had a lot of doubles and triples. I think our highest return has been, has been at 10x. So it was about 10x over about an 18 month period.

Okay, amazing. And again, I guess this is, I'm asking these questions not to try to highlight we've got rocket ships over here at your fund or that you're generating, but more so that this might be more characteristic or more. You have a better opportunity in small cap investing to see these types of returns, as you said earlier in our discussion, than, you know, investing in the broad market, for example.

Absolutely.

Okay. And so last sort of question on small cap investing, I mean this is your fun, this is what you do. I don't think you're changing your strategy anytime in the next year or even the next 10 or 20 years. But I don't know as you sit here today, because you're an investor and I know you're looking at company specifics most of the time, but what's your outlook for a, your strategy? Small cap investing. But in general, any thoughts on how the world is looking these days from an economic perspective and stock market perspective.

We're a bottom up investment firm, so we're typically looking at individual companies and spending the majority of our time looking at that. Now that's not to say you can completely ignore what's going on in the world. You still need to be aware of what's happening, but it doesn't guide what we're doing on a day to day basis. So you could tell me, Brian, the next two interest rate movements and it wouldn't change a thing that I'm doing today. That being said, we're obviously always thinking about things like where we are in the cycle and where we might want to be positioned given that view. But really everything we do is on a bottom up basis looking at individual security. So in terms of small caps themselves, based on current valuations, small caps are trading at a significant, in some cases historic discount to large cap peers in terms of their historical valuation. But even if that wasn't the case, I'd still tell you that I'd be excited about our opportunity set. And I'd still tell you that I think investors can earn outsized returns by investing in small cap stocks. Because small companies become large companies and investors who can identify those outstanding companies early in their life cycle will benefit from both earnings growth and multiple expansion in those stocks over a multi year period. So looking at the Canadian small cap market, specifically where we focus, I think the inefficiencies will persist. And the reason that I'm confident about that is I don't see any change structurally in terms of why more people will start looking in this area. We've, we've talked over the last several minutes about why it's more difficult. So I'm pretty confident that we'll be able to continue to find attractive investments within our investment universe, regardless of where we are in the cycle. And as long as we can identify those opportunities, I think we should be able to generate attractive long term returns for our investors.

Okay, very good. So thanks, thanks for the discussion on small cap equities. Hopefully folks have a good understanding. So if, if we could just for a moment, because I find this stuff fascinating. As I mentioned earlier, you're on BNN all the time. We did do a podcast with John Ehrlichman, the anchor from bnn, but he's the interviewer. I'd love to understand. Just give us a little, if you're okay with it, give us a little bit of color. Like what, what happens when you go to bnn? You know, I see you on tv, you're on. People are calling. They're asking you questions about stocks. Like, what's it like? Walk in there, get prep, get on air. You know, be on the spot while these things are coming on with cameras in your face. I've never done it, and I'm always curious what that experience is like. Can you give a, you know, a little bit of a. Of an insight for our listeners what it's like to be on TV and do that?

Sure. I mean, as you say, it's. It's a lot to manage, especially for someone who doesn't do it regularly. So I think it's like anything else. It's a skill, and you get better over time. But one of the things that really shocked me is that fans of this show are rabid fans. We get tons of calls and emails after the show, and sometimes those are calls from people who want to invest with us, which is great. But other times I've gotten emails from people asking why they couldn't get through to ask me their question or they don't like what I had to say about their favorite stock. I've had people come up to me in airports and restaurants who recognize me and they want to talk stocks. Something else that I think always surprises people and people always ask me about is they always assume we get the questions in advance so that we can research our answers, but in. In reality, we don't. The way it actually works is during each commercial break, one of the producers will speak to me through an earpiece, and they'll give me four or five stocks that callers are on hold and wanting to ask about. And they typically want me to pick three of those five stocks to talk about in the next segment. Now, if I know three of the five, then everything's great, but if I don't, that's when things can get a little bit interesting. And then I guess the. The last piece that continues to amaze me is. Is the power of bnn. And last time I was on, you know, we had at the. For those of you who haven't seen the show, at the end of the show, I come with three of my best ideas, and oftentimes those stocks can move materially higher. We had one stock the last time I was on that was up 22% that afternoon after I announced it as a top pick. So that's something else that continuing to surprise me. You know, not every time I go on, but it's always interesting to see which stocks the viewers get excited about and rush out to buy. Wow.

Okay. Well, I Guess I guess your, your new strategy, if I could give you any advice, is just go on every day. If the stocks just go up 20% every day that you're on, this should be great for, for your fund.

Well, the power of extrapolation can be dangerous, Brian. Yeah, you know, I have a few calls from people who, who have noticed that I was going to be on, and they call me the day before and say, well, can you let me know which stocks you're going to be picking?

Yeah, yeah, hilarious. Okay, sir, well, look, that's great across the board. The last question before I let you go, this is that we're recording this on a Friday, late afternoon. I gotta let you go. We always ask one question at the end and, you know, you know us reasonably well. You know, our tagline at Gensler wealth is your wealth Unlimited. That unlimited word is very critical for us, the notion that we can help families in any way they need. On the financial side, we can look at any, you know, investment opportunity that we think might make sense for clients. We are not limited by maybe some of the limitations that other firms have. So I always ask our guests, you know, if the world is your oyster. If you weren't Jordan running Bedford Park Small Cap Manager and, you know, unlimited options, you could do anything in the world right now other than doing what you're doing and talking to me. What might that be?

I can't imagine doing anything else. I, I, I live and breathe this business. I love it, I'm passionate about it. I can't really imagine doing anything else. And in fact, if I wasn't running the fund, I'd just be investing my own capital and doing all the same things I'm already doing now. So if I'm going to do that, I might as well do it for other people.

Okay, well, that's good passion. Your number one thing is doing what you're doing. That's good for us and our clients who are with you. Thanks, Jordan. Really, really appreciate it. Thanks for the time. Have a great weekend and look forward to forward to catching up with you soon.

Thanks again for having me, Brian. It was a lot of fun.

All right, take care.

The unlimited podcast is hosted and produced by Brian Gensler and is edited and mixed by myself, David McMillan. This podcast is not to be taken as investment advice. If you like what you heard, don't forget to rate the podcast and follow us on social medianslerwealth. Thanks for listening and see you next time.