The Bruce Fund (the “Fund”) shares produced a total return of -3.19% for the six months ended December 31, 2014, compared to a total return of 6.12% for the S&P 500 Index for the same period. Stock markets improved in the period and the Fund lagged most averages for the six month period. The Fund’s negative performance in the period was mainly due to its exposure to the oil & gas industry, seeing significant declines in the related companies common stock, preferred stock and corporate bonds. Other stocks and the government bonds improved during the period.
We believe that the worldwide economy remains fragile, and is likely to produce weaker than expected activity. With lackluster growth and excessive leverage, the risks are to the downside and we feel caution is still warranted. With asset deflation remaining a risk, a more conservative posture is also warranted. While the consensus feels a more normal like recovery will emerge, we are less certain and don’t mind being out of step with convention. Continue Reading »