October 31, 2025
Commentary
Monthly Update
Year-to-date to October 31, the Canadian Large Cap Leaders Split Corp Class A Shares generated a total return of 20.76% and the Preferred Shares generated a total return of 6.39%. For the month, the Class A Shares generated a total return of 0.28% while the Preferred Shares generated a total return of 0.62%1.
CANADIAN LARGE CAP LEADER SPLIT CORP. - COMPOUNDED RETURNS¹ AS OF OCTOBER 31, 2025 | INCEPTION DATE: FEBRUARY 22, 2024
1M |
YTD |
3M |
6M |
1YR |
Inception |
|
|---|---|---|---|---|---|---|
Canadian Large Cap Leaders Split Corp - Class A Shares |
0.28% |
20.76% |
8.53% |
19.73% |
24.89% |
25.65% |
Canadian Large Cap Leaders Split Corp - Pref Shares |
0.62% |
6.39% |
1.87% |
3.78% |
7.71% |
7.71% |
The S&P/TSX Composite Index hit another record closing high in October, just above 30,000, before pulling back slightly as the Materials sector (specifically the gold stocks) corrected. Unfortunately, the trade war with the United States shows few signs of abating, which is impacting some sectors of the Canadian economy, especially those in the Industrials (autos) and Materials (steel and aluminum) sectors. Thankfully, the Canadian Large Cap Leaders Split Corp is primarily focused on the Financials, Energy and Utilities sectors, which are less exposed to cross-border issues.
Again, we were not surprised to see the Bank of Canada reduce interest rates by 25 bps to 2.25% on October 29th, after cutting rates by a similar amount the month prior. We certainly hope that financial support for tariff-impacted industries and the series of interest rate cuts come in time to protect the Canadian economy from deteriorating any further.
In the current environment, we remain invested in a diversified portfolio of high-quality, dividend-paying Canadian companies. But with a weakening jobs outlook, we expect that interest rates will remain low in Canada for the foreseeable future, making our holdings even more attractive from a yield perspective.
Information below is specific to individual securities held in the Portfolio. It is only intended to describe key characteristics of individual holdings at a point in time and makes no inference about the return nor yield of either the Preferred Shares or the Class A Shares of the Canadian Large Cap Leaders Split Corp.
From the chart above, we can see that our holdings, on average, trade at an LTM price to earnings multiple of 15.6x (excluding Brookfield Infrastructure Partners, which typically trades on cash flow multiples), in line with the 5-year average price to earnings multiple of 15.6x.
However, given our outlook for low interest rates in Canada (and supported by a significant discount to the S&P 500, which currently trades at about 22.7x forward earnings, according to FactSet), multiples still have plenty of room to expand in our domestic market. Further, with the Class A Shares trading approximately 5% below the reported NAV at the close on October 31, 2025, we can adjust this table to visualize the implied valuation today.
Information below is specific to individual securities held in the Portfolio. It is only intended to describe key characteristics of individual holdings at a point in time and makes no inference about the return nor yield of either the Preferred Shares or the Class A Shares of the Canadian Large Cap Leaders Split Corp.
The implied discount was currently 0.8x worth of multiple points at the close on October 31, 2025, which highlights the opportunity to buy our portfolio of Canadian high-quality, dividend payers below long-term historic valuations through the purchase of shares of NPS on the open market. Note that the combination of our marketing efforts and buybacks related to our NCIB has reduced the discount to NAV on the Class A Shares from 15% to just 5% over the course of the month and liquidity has improved, which are positive developments for our shareholders and quite gratifying to see.
Finally, we would like to highlight that the Canadian Large Cap Leaders Split Corp has announced its next distribution, payable on November 14, 2025, to Class A Shareholders of record at the close of business on October 31, 2025. As planned, holders of Class A Shares will receive the $0.12500 per share regular monthly dividend.
As always, we appreciate the support of all those who have invested in the Canadian Large Cap Leaders Split Corp.
Until next month,
John, Jeff & Colin
Ninepoint Partners
1All returns are based on Net Asset Value per Class A share, or the redemption price plus accrued interest per Preferred share and assumes that distributions made by the Fund on the Class A shares, or Preferred shares in the period shown were reinvested in additional Class A shares and Preferred shares of the Fund as at 10/31/2025.