INVESTMENT APPROACH

Fixed Income

We build bond portfolios focused on high quality government bonds, corporate debentures, convertible bonds, and preferred shares. We independently analyze and evaluate the credit quality of our issuers to minimize default risk and to identify opportunities. Our primary fixed income objective is to achieve steady, reliable returns.

We maintain a high quality bond portfolio by setting investing parameters based on credit quality ratings, issuer concentration and sector exposure. We set the average term to maturity of the bond portfolio based on our view on the direction of interest rates. We govern risk by measuring and monitoring the credit quality, issuer concentration, term and yield of the fixed income portfolio to ensure we are managing within our policy guidelines.

Equities

We buy a portfolio of sustainable and enduring businesses run by capable, committed and candid people. We select equities on the basis of good value. We hold positions over an indefinite period of time.

Company Analysis & Security Selection

We test companies for possible portfolio inclusion based on criteria that evaluates the following:

  • The quality and commitment of management
  • The historical financial record, with an emphasis of evaluating the sustainability of businesses through different economic cycles
  • The company’s competitive position and business outlook
  • The strength of the company’s balance sheet
  • The valuation of the company relative to expected returns, with an emphasis on minimising downside risk
  • The cash flow and dividend record of the company
  • Enhancement to the portfolio’s quality, value and growth characteristics

Balanced Fund Investing

Our balanced approach has provided investors with above average long term growth and income generation with low volatility, through investment in a diversified mix of high quality Canadian common shares, preferred shares, income trusts and bonds.

In the asset mix decision, fixed income and equities must be risk managed on fundamentals and compared based on the criteria of valuation and yield.