Matthew Sigel

Like many defense contractors, just earnings are really lumpy and it's hard to get good visibility for national security reasons.

And so the multiple that investors pay for that kind of lumpiness is –

pretty low, right?

So the way that I've been playing it, another stock which has contributed a large amount to our returns this year, it's through Hynix.

So the DRAM market.

Drones right now are about 30 basis points of DRAM demand.

So really small.

But when you look at the growth, not only in drone volumes, but also in how much memory is going into these drones to make this autonomous, it's like a 10x increase in the amount of memory per drone.

Plus you get the volume boost on top of it.

If you can get DRAM to, if you can get drones to three or 4% of DRAM demand, that is enough to really change the calculus because so much of that DRAM is locked up in long-term contracts.

There's not that much available in the spot market.

So I've been, you know, long and strong on the Hynex story and, you know, a little bit of wobbles here the last week or so, but that's one element which is keeping my conviction relatively high.

Yeah.

I've been really underweight these names because I just don't see the need to add leverage to what is already a very volatile asset.

It works really well on the upside and then the drawdowns just can crush your performance and volatility.

And that –

Conviction that we had really as a shop, VanEck, we did not really participate in the debt capital formation.

And part of that conviction comes from investing in Asian conglomerates over the years.

There's a lot of listed companies that trade on their net asset value, which usually consists of a bunch of real estate and businesses that are kind of quasi-liquid.

And those stocks trade at like 0.3, 0.4 times NAV, even when the NAV is growing.