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.

This week's interesting finds

EdgePoint reading and listening list

Spring’s almost here and so is our annual March Break reading (and listening) list. The Investment Team shared some of their top recent reads and podcasts, including deep dives into some of the largest companies in the world today.

A few charts worth discussing

“The slope of the middle-income group is the concerning one.”

- Geoff MacDonald

“Debt balances in margin accounts are at the highest level in almost 30 years, coinciding with one of the strongest 3.5-year stretches for the 500 largest U.S. companies over the past century.”

- Tye Bousada

“It can't bode well for government finances, and by extension younger taxpayers, when populations are aging and simultaneously not saving enough for retirement.”

- TJerk de Gruijter

Other charts worth pointing out

Debt maturity by credit rating – software & services

Geopolitical events and historical returns by asset class

Energy dependence vs. energy sector as % of equity market cap by country

Natural gas net trade balance in Asia/Oceania

Crude oil reserves by country

Liquid natural gas exports traveling through the Strait of Hormuz

Power generation sources by Asian country

Median excess return by sector vs. the S&P 500 Index

AI hyperscaler depreciation & amortization

AI hyperscaler free cash flow vs. earnings

Federal Reserve to loosen capital requirements for big US banks

A top Federal Reserve official has said the central bank will soon cut capital requirements for big banks as it eases protections that were designed to avoid a repeat of the 2008 financial crisis.

The moves, announced on Thursday in a speech by Fed vice-chair for supervision Michelle Bowman, intensify the push by US regulators to loosen restrictions on Wall Street banks to encourage them to boost lending and regain market share lost to private credit groups.

She outlined plans to change the way an extra capital buffer is calculated for the biggest banks, which would lead to a “modest decrease in the surcharges” and more than offset the impact of the Basel reforms.

The Fed’s plans, which were welcomed by US lenders, are likely to intensify calls from banks in Europe and other countries to ease their rules in response. The Bank of England and EU have delayed part of their Basel reforms to see how Washington would apply them.

Three of the main US banking trade bodies said Bowman’s plans were “a thoughtful, bottom-up approach” that represented “a welcome focus on risk-sensitivity and a comprehensive view, taking into account the cumulative effects of all capital requirements”.

The Fed’s proposals represent a victory for Wall Street lobbying. In 2023, the Fed announced plans to implement the so-called Basel Endgame reforms in a way that would have resulted in a 19 per cent rise in minimum capital requirements of big US banks.

But the central bank agreed to dilute the proposals in 2024 following an aggressive campaign by bank lobbyists, including TV advertisements during half-time of the Super Bowl warning earlier that year that the rules would hurt American consumers by cutting lending and raising credit costs.

Bowman said reforms introduced after the 2008 meltdown had “substantially increased bank capital and strengthened financial system resilience”. But she added there was a risk of “unintended consequences” from excessively calibrating low-risk activities.

As part of the changes outlined on Thursday, Bowman said the extra capital buffer required for the eight most systemically important US banks would be reduced by lowering the component that accounts for risk from short-term funding. The buffer will also be adjusted for inflation and growth to prevent it rising as bank balance sheets grow.

This week’s fun finds

IT intern Sidharth (a.k.a., Sid) ordered an Afghani feast for the office on a snowy day. It was the perfect amount of spice to keep us warm. Thanks for delicious meal!

Man accidentally gains control of 7,000 robot vacuums

A software engineer’s earnest effort to steer his new DJI robot vacuum with a video game controller inadvertently granted him a sneak peek into thousands of people’s homes.

While building his own remote-control app, Sammy Azdoufal reportedly used an AI coding assistant to help reverse-engineer how the robot communicated with DJI’s remote cloud servers. But he soon discovered that the same credentials that allowed him to see and control his own device also provided access to live camera feeds, microphone audio, maps, and status data from nearly 7,000 other vacuums across 24 countries. The backend security bug effectively exposed an army of internet-connected robots that, in the wrong hands, could have turned into surveillance tools, all without their owners ever knowing.