Insights · By Yue Jer
Mr Lee Yue Jer (“YJ”), the Fund’s Lead Portfolio Manager, is an internationally recognised specialist in the lithium sector.
YJ’s work in the lithium sector includes tracking every single lithium mine producing today through 2030, totalling more than 145 individual mines managed by over 100 listed companies. By tracking and forecasting the output of every mine in each year, the Supply side of our lithium forecast is built. On the demand side, YJ tracks and models electric vehicles, trucks, buses, motorcycles, BESS (Battery Energy Storage Systems, i.e. grid storage), and industrial uses for each year, converting industry sales figures into lithium consumption data. His numbers have been boldly ahead of analyst consensus for years, with the analysts raising their BESS forecasts by >200%[i] last year as industry numbers proved the accuracy of his forecast.
YJ is regularly invited onto the Rock Stock Channel and Money of Mine podcasts[ii], respectively being Canadian and Australian mining-expert channels, to share his research and opinions on the lithium market. He also regularly speaks at Lithium and Battery Minerals conferences globally. He is one of the few Singapore-based portfolio managers to be recognised internationally in this specialist field. He presented at the Fastmarkets Lithium Conference, the largest Lithium event in the West annually, in 2025 and 2026.
We can access sources and information from both hemispheres.
Sitting in Singapore and being fluent in English and Mandarin, we can access information from both Western and Chinese spheres, integrating them into a much-clearer picture of the global industry[iii]. We were calling for BESS to be a key driver of lithium demand in early 2025[iv] before Wall Street analysts trebled their forecasts for this sector in 2H2025, as an example. By that time, we were already calling for Electric Trucks to be a significant driver of lithium demand growth stemming from the >100% growth being exhibited[v] while not a single Western analyst was writing about this.
We are fundamental and contrarian investors at heart.
In June 2025, we called the bottom of the lithium market and allocated 11ppt[vi] of the portfolio into Lithium after speaking at the Fastmarkets Lithium Conference in Las Vegas. The lithium sector doubled in 2H25 following the rebound in lithium prices.
We invest for the longer term (3-5 years) and try to ignore market noise. This leads us to sometimes catch falling knives, taking short-term drawdowns in return for a much-bigger return when stock prices revert towards their intrinsic values. We are also humble enough to know our strengths and weaknesses – we are much better at picking the industry bottoms than the tops. This rewards patient capital more than a trading approach, with time in market more important than timing the market.
We demand high IRRs in our investments by using very high discount rates and hold them into full-value. We run a focused portfolio so that high-conviction picks have a meaningful impact on returns.
We regularly discount our producing lithium mines at 14%, under-construction mines at 16%, and exploration projects at 20%. When we discover companies that still provide >100% DCF-value over the current share price, we allocate a conviction 3-5% of the portfolio into the shares and hold them for multiple years to let the market price reach the fundamental value we see. We hold 30-40 names in the portfolio, with the high-conviction allocations allowed to reach a maximum of 10% before being trimmed back. This approach resulted in the 165% net return[vii] to investors in 2025.
Our stock selection methodology has yielded 4-11 baggers in two years.
The combination of our macro analyses (geopolitical and industry trends) with bottom-up DCF approach has resulted in our high-conviction (top 10) positions returning up to 1100%[viii].
We first bought Discovery Silver (DSV CN) at C$0.99 in May 2024. The stock peaked at C$11.77 early this year and is still at C$10.50 today. We reduced most of the position around C$8-10.
We began accumulating Q2 Metals (QTWO CN) aggressively in April 2025 when the stock was at the C$0.50 range. It recently hit a peak of C$3.37 and remains at C$2.35 today. We continue to hold this as its assets trade at a significant discount to peers.
We found multi-baggers even in large-cap stocks. We first bought Fresnillo (FRES LN), one of the largest silver/gold producers in the world in May 2024 just under £6. The stock peaked at £44 and has retreated to £27, still comfortably above our entry point. We did take profit around the £30-36 level.
[i] https://x.com/usuallyYJLee/status/1991415406222070141?s=20
[ii]Rock Stock Channel: https://www.youtube.com/watch?v=RGubsZ1DwV0 ; https://www.youtube.com/watch?v=QhxpGBQ5HG8
Money of Mine: https://www.youtube.com/watch?v=ECi3FjRgNvc ; https://www.youtube.com/watch?v=YkTATnUhSck
[iii] https://x.com/usuallyYJLee/status/1968539413182562533?s=20
[iv] https://x.com/usuallyYJLee/status/1891342597504840092?s=20
[v] https://x.com/usuallyYJLee/status/1944686688397373465?s=20
[vi] Refer to ARCANE GREEN METAL FUND Letter to Investors — 9M 2025.pdf
[vii] This figure is stated net of fees for the financial year ended 31 December 2025; past performance is not necessarily indicative of future performance (please refer to the Important Notice at the end of this document).
[viii] These returns relate to selected individual holdings shown for illustration and are not representative of the Fund’s overall performance; other holdings have performed less well and some positions may result in loss