Mirador Portfolio Management Update for the Second Quarter of 2025

Dear Friends and Clients,

I’d like to start off by welcoming our new clients to the Mirador family. Thank you for placing your trust in us.

I just finished reading the last portfolio management update from April of this year. Back then I described how crazy things were in the markets and portfolio management. Earlier this year the hedging activity was really busy. We were adjusting sector allocations frequently. We were trimming many weaker positions and adding to stronger ones with better yields and fundamentals. We traded almost every day – hundreds of transactions starting from last fall right up to a couple months ago.

The great news is that it all worked smashingly well. We avoided a good deal of the Tariff mini-crash in April. And then we recovered quickly from the small portion of the mini-crash we did experience. We have set new high-water marks in 7 out of the last 8 weeks. And now, what a difference the last while has been. Our transaction activity has returned to a more normal “maintenance-type” level. And all this time we preserved the high income stream that we all want from the Mirador Income and Stability programs.

As you might recall, just like draw-down is the most important risk measure, rolling returns are much better for examining results (versus calendar defined periods). Rolling returns are simply the returns for a time period specified prior to the stated “as of date”.

Notes:

• The benchmark is 40% XBB, 30% XIU, 30% SPY
• Standard Deviation is a common measurement of volatility

Observations:

• We have beaten the benchmark for every rolling time frame
• Despite being a stable income fund, we beat the stock indexes in 5 of the 8 possibilities
• Only the bond market has had lower volatility (but it had negative returns for every time frame shown above)

The main changes since the last update have been:

• Added to Fixed Income Preferreds in order to maintain its percent allocation
• Decreased call writing to reflect the less bullish market stance as the markets approached over-bought territory
• Eliminated U.S. call writing ETFs due to Canadian dollar and Canadian stock outperformance
• Increased Equity income to take advantage of the higher yields from the mini-crash
• Based on relative strength analysis we rotated sector exposure more towards:
  • telecom
  • commodity cyclical
  • precious metals
  • real estate

Tacos Anyone?

Taco is the new trading term. It is an acronym for “Trump Always Chickens Out”. For some time, he declares or threatens with something and then changes his mind. I talked about this after his election when I discussed his negotiating tactics revealed by his book “The Art of the Deal”. He comes in strong until he gets what he wants (which is less than what he originally asked for), and then he somewhat concedes, leaving his opponent thinking they did okay. It’s kind of like marking up a product enormously, so when you put it “on sale”, people think it’s a good deal.

All Eyes on the Data

Although our activity in the programs has calmed down to more normalized levels, we are still very busy observing reactions to all the world events and the Trump Antics. It seems like with most tariff announcements the U.S. dollar and markets see weakness and Canada does not – or least not as much so. It is possible that the Orange Man wants the U.S. dollar lower to improve export competitiveness. And he has never really cared for the stock market, and he knows the relative weakness will likely be shorter term.

One of the most dramatic capital market changes in the last while is with the yield curve. The steepening has been quite incredible, and it is coming from declines in the short end but more so from increases in the long end. This is good news for the markets and economy. The long end represents inflation expectations, which will most likely come from an improved economy – more demand for goods. And the drop in the short end indicates a faith that Powell and friends will reduce rates in the near future.

Out here in the hills southwest of Longview, the rain has been timely. The creek is flowing, and the grass is growing. All the beasts are happy. Soon I will tag, cut, vaccinate, and then let the bulls out. Jessica has a summer job at the Crossing Resort on the Jasper highway. I went for a visit and hike Sunday. What an amazingly beautiful area and the people at the resort seem great. Emily is very busy in the Calgary rugby scene. Joyce and Emily have a big back country hike planned for the end of July. I am at my lowest weight and best fitness in ten years, and I am working a great deal on my drumming.

One request to you, your family, and friends,,,,, please visit our website and read and click on it lots;

Mirador Corporation

The more visits and clicks etc., the better we do on internet searches. The better the search results the more interest we get. The more new clients we get the better the likelihood we keep our fees low. A win win!

That’s it for Q2 2025. As always, phone or reply to this email to just say hello, or if you have any questions comments or ideas.

Sincerely,

Stan 403-608-4664

Joyce 403-978-6798