The Lead Off

The shifting landscape continues. Global financial markets remain unsettled as evolving trade negotiations under the current U.S. administration introduce fresh uncertainty.

Canadian markets, in particular, have felt the impact, with over $35 billion in foreign capital withdrawn in Q1 2025 alone - a clear sign of declining international confidence. The trend underscores broader investor caution amid geopolitical tensions, shifting interest rate expectations, and ambiguous trade policies that continue to disrupt capital flows across North America.

As investors reassess their strategies, this month's update builds on last month's IWG by highlighting one of Grove's new clients, Steepe & Co., an Investment Fund Manager offering alternative non-listed private funds - an increasingly relevant option for portfolio rebalancing in today's environment.

Market Watch

Index	Price	YTD	Previous YTD
TSX	26,073.13	5.04%	(0.091%)
TSXV	697.77	15.67%	8.28%
CSE	119.71	(14.27%)	(15.97%)
CBOE VIX	20.57	29.52%	46.14%
Commodity/ USD
Gold	3,342.475	27.33%	26.66%
Silver	33.493	13.28%	12.17%
CAD	0.7277	4.80%	4.07%
BTC	109,417	17.21%	1.65%

From TradingView

As of close on Monday May 26, 2025

On Our Radar

The CSE and the National Stock Exchange of Australia have entered into an agreement that will see the CSE acquire the NSX (owner of the National Stock Exchange of Australia) in an all-cash transaction.

The OECD released their 2025 Economic Survey of Canada yesterday which outlined the need to boost productivity and housing affordability. The report comes as economists say Canada has likely entered a technical recession.

Earnings reports from the big banks being released throughout the week, as well as U.S. and Canadian GDP figures, will provide more clarity on the state of the Canadian economy.

Steepe Yield Ahead

With Inflation lingering, interest rates in flux, and global uncertainty still driving volatility, many investors are rethinking the traditional 60/40 portfolio. The market swings of the past year have made one thing clear: resilience and diversification now mean more than just spreading capital across stocks and bonds.

Private credit has stepped into the spotlight as a timely alternative. As traditional banks pull back from middle-market lending, private credit funds are filling the gap - offering investors access to floating-rate loans, strong income potential, and lower correlation to public markets. It's a strategy that's increasingly resonating with those seeking more stability and predictable returns.

Moody's

That's where Steepe & Co. comes in. This Toronto-based Investment Fund Manager provides Canadian investors with access to U.S. private credit markets through a suite of funds designed for capital preservation, steady income, and low volatility. As part of a thoughtful portfolio rebalancing strategy, these funds offer a compelling option for those looking to enhance yield without taking on excessive risk.

Performance at a Glance:

U.S. Bridge Loan Fund Trust (USBLF)

2024 Net Return: 7.48% / Since Inception (Dec 2020): 7.03% annualized*

U.S. Diversified Direct Lending Fund

2024 Net Return: 10.49% / Since Inception (Jul 2020): 10.9% annualized*

U.S. First Mortgage Income Fund (Cayman)

2024 Net Return: 12.41% / Since Inception (Nov 2022): 12.23% annualized*

*Past Performance is no guarantee of future results and investors could lose some or all of their investment. See the USBLF Offering Memorandum for a complete list of the risks involved.

Led by seasoned President & CCO, Michael Steepe, the firm has built a reputation for delivering income-focused solutions that align with the evolving needs of Canadian investors. With ongoing strength in U.S. sectors like technology, infrastructure, and healthcare - and a robust private credit ecosystem - this could be a timely opportunity to rethink fixed income allocations and position for more consistent performance ahead.

If you're looking to incorporate private credit into your strategy - or just want to explore income alternatives beyond public markets - reach out to us to request a detailed fund overview or schedule a one-on-one with the Steepe & Co. team.

Sources: Preqin, Securities Industry and Financial Markets Association, Global Banking pools by McKinsey & Company, McKinsey Analysis

Additional Sources

Where insight meets opportunity - tailored capital markets solutions and strategic guidance to help you navigate the capital markets with confidence. Reply to this email or reach out to Nick at nick@grovecorp.ca to explore how Grove can help your business.