This week's interesting finds

Oh, brother

Originally published in the 2025 Cymbria Annual Report, “Oh brother” is a hypothetical conversation between a brother and sister about managing future regret based on what others are ignoring in the market – both the major risks and the opportunities available in underappreciated areas.

Brand Management

An in-depth dive into one of Cymbria’s largest holdings, Restaurant Brands International. This is the latest commentary from Jason’s corner.

A few charts worth discussing

“The United States has become the #1 natural gas producer in the world, accounting for 25% of worldwide output. Despite this, much of U.S. production has been constrained due to a lack of export infrastructure. They’ve also put pressure on Canadian gas producers to sell natural gas into the American market.

“A shortage of transport capacity has resulted in producers occasionally selling natural gas at negative prices. However, there’s an industry change underway where midstream pipeline operators and liquid natural gas (LNG) operators are actively adding transportation and export capacity for natural gas."

- Stas Lopata

“AI and machine learning are speeding up the early stages of drug discovery, raising fears that pharma and biotech companies could cut spending on the tools needed for clinical trials. The evidence so far shows that spending on wet lab (practical analysis), along with dry lab (theoretical data analysis), spending continues to grow. This is consistent with what management teams have been telling us – that AI is producing more hypotheses and candidates requiring validation, thus increasing the need for more work in the physical lab.”

- Claire Thornhill & Rhea Jandu

“Over the past decade, industry-wide R&D investment has shown steady growth even as new technologies have been introduced.”

- Claire Thornhill & Rhea Jandu

“I thought I was going to save money and not have to watch ads...What's old is new again!”

- Frank Mullen

Other charts worth pointing out

AI-related industry performance

60/40 portfolio returns by asset class

U.S. tech debt as % of credit category

Investment grade tech debt vs. index – credit spreads

Gold vs. US$ – reserve assets

Developed markets ex-U.S. vs. U.S. – relative performance

Taiwanese exports by sector

Global transaction values

U.S. consumer spending

China throws the switch on battery buildout ‘equal to 10 times US capacity in 2025’

China’s leading battery makers have unveiled plans to add more than 600 gigawatt-hours (GWh) of new production capacity for the energy storage system (ESS) market in just the first two months of 2026, underscoring surging global demand for renewable energy infrastructure. 

According to the GGII Energy Storage Research Institute, a Shenzhen-based consultancy, 19 mainland Chinese battery producers it tracks were set to invest a combined 180 billion yuan (US$26.3 billion) to build new lithium-ion battery factories.

Once completed – with some facilities due to come online in late 2026 – the projects will add up to 900GWh of annual production capacity. About 70 per cent of this would be dedicated to the ESS market, with the remaining 30 per cent serving the electric vehicle (EV) sector, GGII said in a report released on Wednesday.

ESS comprises batteries alongside battery management, power conversion and control systems that store excess energy generated from renewable sources, while providing backup power during outages and helping stabilise electricity grids.

One GWh of battery capacity can supply around 750,000 households for a year.

China has emerged as the dominant force in the global ESS industry, with mainland companies accounting for more than 80 per cent of the market. According to Seoul-based SNE Research, global ESS battery demand rose 79 per cent year on year to 550GWh in 2025.

As China’s ESS sector expands rapidly with government backing, the US is racing to catch up, as Washington moves to restructure supply chains to exclude Chinese-made batteries and components.

In 2025, newly installed battery storage capacity on the mainland rose 40 per cent year on year to a record 174.2GWh, according to Benchmark Mineral Intelligence.

But as expansion accelerates, policymakers are starting to take notice.

Four Chinese government departments – including the Ministry of Industry and Information Technology – convened a symposium on April 9 to discuss early intervention measures aimed at curbing irrational competition in the power and energy storage battery sectors.

Officials said they would strengthen capacity monitoring, guide more orderly price competition and tighten regulatory oversight.

The bullish outlook comes as China ramps up battery exports. In the first 11 months of 2025, the country exported 4.25 billion lithium batteries worth more than US$69 billion, up 19.3 per cent and 25.6 per cent respectively from a year earlier, according to customs data.

This week’s fun finds

How NASA Achieved the Historic Artemis II Splashdown

Every crewed mission to the moon starts with fire and ends with water. Artemis II was no different. The spacecraft and crew began their journey on April 1, under the power of six rocket engines pouring flames that generated 8.8 million lb. of thrust. The mission ended Friday night, April 10, at 8:07 p.m. EDT, off the coast of San Diego. The Orion capsule hissed into the ocean, gently settling down atop the waves at just 17 miles per hour, under the control of three 116-ft. diameter parachutes. Less than two hours later the four astronauts—commander Reid Wiseman, pilot Victor Glover, and mission specialists Christina Koch and Jeremy Hansen—will be safely on the deck of the USS John P. Murtha, successfully concluding the first crewed mission to the moon in 54 years. 

This week's interesting finds

A few charts worth discussing

“Canada was recently above the previous peak in housing affordability seen in 1989/90. While it’s corrected somewhat, affordability still doesn’t look great relative to historical levels. Specifically for Toronto, mortgage payments on a median house are still around 70% of median income, and this likely needs to fall closer to 50% to make housing more affordable for people.” 

- Jeff Hyrich

“None of the largest companies from 40 years ago are still in the top 10, which is now dominated by a single sector: Technology. I wonder how this will look 40 years from now!” 

- Tjerk de Gruijter

Other charts worth pointing out

Strait of Hormuz – outbound commercial ships 

U.S. gasoline – Average retail price per gallon

Chinese refinery operating rates

S&P 500 Index – earnings growth during oil supply shocks

S&P 500 Index – earnings growth by sector during oil supply shocks

S&P 500 Index – earnings growth from AI

S&P 500 Index – Days to a 5% decline during bear markets

Major index price return – as at Mar. 31, 2026

Fund ownership of Mag 7 & AI companies

U.S. AUM allocation – active vs. passive

Blue Owl struck by $5.4bn of redemption requests

Private credit investment firm Blue Owl Capital was struck with a mammoth increase in redemption requests in the first quarter, with investors seeking to withdraw roughly $5.4bn from two of its flagship funds as questions intensify about the health of the asset class and the firm at its nexus.

The company on Thursday disclosed that withdrawal requests at its tech-lending fund, known as Blue Owl Technology Income Corp, had surged to 40.7 per cent of the fund’s $3bn value. Requests to exit the New York-headquartered firm’s marquee $20bn direct-lending fund, called Blue Owl Credit Income Corp, shot to 21.9 per cent of the fund’s value.

The limitation on outflows highlights the risks to individual investors who had flocked to so-called non-traded private credit funds over the past three years in periods of stress. Those wealthy individuals had been promised access to higher-yielding investments in exchange for limited liquidity.

The decision to cap redemptions also underscores the pain being felt at Blue Owl, the relative newcomer to the private investment world, and which now manages more than $300bn.

Shares of the company fell more than 7 per cent in trading in New York on Thursday, taking its stock price decline to more than 47 per cent this year.

The sell-off had accelerated on Wednesday, the day after investors had to decide whether to submit requests to redeem from the two funds. The market had braced for double-digit withdrawals at both vehicles, according to people briefed on the matter.

Blue Owl’s two vehicles, which use leverage to amplify returns and multiply their ability to invest, managed portfolios worth more than $42bn at the end of 2025.

The attempted exodus by investors eclipsed redemption requests experienced by Blue Owl’s largest peers, many of which have already limited withdrawals, underscoring investor concerns with its vehicles.

In the first quarter, investors have attempted to pull more than $19bn from direct lending funds, the popular private credit vehicles that provide loans directly to companies and private equity firms, without a bank as an intermediary.

The funds, which hold investments worth roughly $275bn, have in aggregate honoured just over half of the withdrawal requests they have received, according to FT calculations.

The redemptions will complicate the pitch that private investment managers plan to make as they target the more-than $10tn US retirement system, which the industry views as its next big engine of growth. The Trump administration this week said it would provide new rules to help open popular tax-deferred 401k savings accounts to private investments.

The US Treasury separately on Wednesday said it would seek to meet with regulators that oversee the insurance industry to understand the risks stemming from private credit, a catch-all moniker for an asset class that has ballooned to include far more than corporate loans such as those provided by the Blue Owl funds that limited redemptions.

This week’s fun finds

‘Not a Stunt, or an April Fool’s Joke’: KitKat Ramps Up Efforts to Locate 400,000 Stolen Candy Bars

More than 400,000 KitKats are missing. And no, that’s not an April Fool’s joke.

The company has confirmed that roughly 12 tons of its candy bars, which comes out to 413,793 KitKats, were stolen last week while being transported in Europe. On Wednesday, it launched a “Stolen KitKat Tracker,” asking the public for help locating the missing treats.

KitKat announced on Wednesday that it had launched the tracker on its website in an effort to identify and locate stolen candy bars. A customer can go to the webpage, and then type in the eight-digit batch number on the back of their candy bar. When the customer hits “enter,” the website will say whether the KitKat is one of the 413,793 candy bars that were stolen.

This week's interesting finds

2025 Cymbria annual report

This year’s annual report is now available on the Cymbria website.

A few charts worth discussing

“Cumulative telecom default rate hit 74% after the Tech Bubble. We'll see if AI hardware can beat it.”

- Derek Skomorowski

“Despite economic downturns, coffee demand has remained largely resilient, trending steadily upward over the long term.”

- Tracey Chen

Other charts worth pointing out

High yield bonds – % of market rated BB

Market rallies following 10% and 20% declines – bear markets vs. corrections

AI effects on employment in the Philippines and India

Global central bank reserves – gold vs. U.S. Treasuries

Major crypto sell offs since 2017

European energy production – German nuclear power generation & U.K. North Sea oil & gas production

Change in toy sales by category – 2025 vs. 2024

Change in toy sales by category – 2025 vs. 2021

401k equity allocation by age group

S&P 500 Index performance during World War 2

Bathhouses to rice crackers: Japan’s small businesses suffer Iran war energy crunch

A surge in oil prices because of the US-Israel war on Iran and Tehran’s blockage of the Strait of Hormuz, an international shipping chokepoint, has strained supplies of refined petroleum products. Japan sources more than 90 per cent of its crude from the Middle East.

Thousands of businesses are grappling with a commodity price shock that is threatening factory closures, raising prices for consumers and halting wage rises that help drive consumption growth.

Some have already been forced to take drastic measures. In the northern city of Aomori, Masayoshi Yamaguchi is planning to shut the Katsuragi Onsen, a sento or public bathhouse, after 27 years at the end of May. The conflict in the Middle East was “the biggest factor” in the decision, he said.

Prime Minister Sanae Takaichi pledged to ease cost of living pressures ahead of her landslide election victory last month. On Tuesday, she vowed to step up emergency measures to tackle the energy crisis by conducting a review of supply chains using petroleum products.

But economists said that in addition to its reliance on imported energy, Japan’s highly fragmented economy made it difficult to weather the storm, while its panoply of smaller businesses lacked the heft to exert pricing power.

Unlike larger companies, which sell into foreign markets and often perform strongly when the yen is weak, Japan’s smaller companies behave more similarly to households and are hit hard when the domestic economy is under pressure.

Takaichi at the start of the week increased funding for emergency fuel subsidies by ¥800bn ($5bn) to cap petrol prices at ¥170 per litre. But the Nomura Research Institute estimates the subsidy budget will be depleted by early July.

Toribe said the commercial fuel users were not feeling the benefits, expressing “distrust” towards the suppliers.

Meanwhile local TV news is flooded with stories of petrol stations suspending operations, saying they cannot supply customers at an affordable price.

The reported inquiries, which are viewed in the market as a form of verbal intervention, would represent part of authorities’ efforts to protect households and businesses from the double impact of surging energy prices and the weak yen, which is currently trading at around ¥158.5 against the dollar.

Finance minister Satsuki Katayama said this week that the government was ready to take “all possible measures, at all times and on all fronts”. Japan is set on Thursday to start releasing national oil reserves that amount to 254 days worth of demand, when also factoring in private stockpiles.

The cost of heavy fuel oil used to heat industrial boilers is causing pain even in some hot spring or onsen resorts that can draw on naturally warm water. Many onsen hotels, inns and bathhouses use oil or gas to heat water to bathing temperatures while also having to keep often poorly insulated buildings warm.

This week’s fun finds

Baseball’s math problem: Filling all those innings in an era when less is more for starting pitchers

Bubic grew up in California and idolized Clayton Kershaw. He attended a school with a celebrated baseball program — Stanford University — and was drafted in the first round. He advanced quickly, skipping two levels of the minors and arriving in the majors in 2020. Three years later, he had Tommy John surgery. Now he strikes out a batter per inning.

He also has never pitched more than 130 innings in a major-league season.

Every morning at spring training, Bubic and his teammates stretch in the shadow of a giant mural with images of the Royals’ Hall of Famers. Among them are seven starting pitchers — Dennis Leonard, Bret Saberhagen and so on — who all logged multiple seasons of at least 230 innings. This was only natural: They were very good, so they pitched a lot.

Bubic said he trains hard and does all he can to stay strong through the season. But his story underscores a harsh reality: While the MLB schedule has been fixed at 162 games since 1962, the nature of pitching has changed immensely. Teams must fill the same number of innings as they did when Warren Spahn was an All-Star, yet their pitchers are engineered for a very different game.

This week's interesting finds

A few charts worth discussing

“In leveraged loans, EBITDA add-backs now reduce reported leverage at issuance by roughly 1.2 turns of leverage. In direct lending, the impact is even larger - about 1.9 turns. In both cases the gap is roughly double what it was in 2015. As a result, the reported new issue debt-to-EBITDA of 4.6x for leveraged loans and 5.0x for direct lending often masks underlying leverage that’s actually 5.9x and 6.9x, respectively.”

- Jason Liu

“Even after layering in all the make-believe add-backs, leverage in private credit would land the average issuer firmly in the B-/CCC rating bucket. To be clear, this is a $2 trillion asset class with credit metrics on par with B-/CCC high yield bonds, which usually make up less than 20% of the high yield market and have a long-term average annual default rate of 20%-to-25%.”

- Derek Skomorowski

“The largest wealth builders in history...with the shortest time frame clocking in at 74 years for Northrop.”

- Frank Mullen

Other charts worth pointing out

Business development companies – AUM

MRIs by country

Number of MRI scanners – Canada vs Pennsylvania

Concentration peaks

Tech sector fund flows

Historical annual global equity returns vs. bond returns

Relative weight vs. S&P 500 Index by factor group

BofA Fund Manager Survey – Cash levels have largest monthly increase since COVID

Emerging markets equity allocation 

Private Credit’s Investor Exodus Spreads to Consumer Loans

Stone Ridge Asset Management told clients in the fund last week that recent redemption requests were so high that it would honor only 11% of the amount investors wanted back, according to an investor update viewed by The Wall Street Journal.

That suggests that investors’ concerns about private credit are broadening. Unlike other private-credit funds that experienced a flight of investors in recent weeks, Stone Ridge’s fund didn’t hold loans to software makers or other corporate sectors that investors fear will be displaced by advances in artificial intelligence.

The details

The Stone Ridge Alternative Lending Risk Premium Fund buys whole loans and securities backed by loans made by fintech lenders. That includes buy-now-pay-later loans from Affirm, personal loans from LendingClub and Upstart and loans that payments companies like Block and Stripe offer to merchants using their platforms.

LENDX, as the fund is also known, owned $2.4 billion of total assets at the end of November, and $1.6 billion of net assets.

LENDX is structured as an interval fund, meaning it must offer to repurchase at least 5% of shares outstanding each quarter. The shares don’t trade publicly, so investors who want to exit have to submit redemption requests to Stone Ridge during predetermined windows, the most recent of which ended on March 6.

Stone Ridge’s update didn’t include what percentage of overall LENDX shares investors wanted to redeem. Already, the firm offered in February to repurchase as much as 7% of its shares outstanding, with an option to buy back an additional 2% of shares if its offer was oversubscribed.

The context

With scores of investors wanting to cash out of private credit in recent weeks, fund managers have had to grapple with whether to relax their existing redemption limits.

Cliffwater, for instance, is paying out about 50% of redemptions requests it received at the Cliffwater Corporate Lending Fund.

With $31 billion of assets under management at the end of 2025, Stone Ridge is a smaller player in private credit. The firm also manages investments in fine art, energy, reinsurance risk and, through its NYDIG affiliate, bitcoin.

Ross Stevens is the founder of Stone Ridge and chief executive of its parent company. Stevens made headlines in January when he gave a record $100 million gift to the U.S. Olympic & Paralympic Committee that included $200,000 for each athlete competing in the Milan Cortina Games.

This week’s fun finds

On a recent trip to Nelson, BC, Kevin got his hands on some local hot sauces with West African influences. While they weren't the hottest we've ever tried, everyone loved the flavours!

Turing Award Goes to Inventors of Quantum Cryptography

In the mid-1980s, Charles Bennett and Gilles Brassard invented an encryption technology that could theoretically never be broken.

Called quantum cryptography, their technology relied on quantum mechanics, the strange and powerful behavior exhibited by electrons, photons and other very small things.

 At the time, their technique was a fascinating but impractical creation. Forty years later, it is poised to become an essential way of protecting the world’s most sensitive information.