This strategy is primarily composed of units of real-estate income trusts. The portfolio may also be invested in high dividend-yielding stocks. The return objective is to outperform the market index as well as peers over a market cycle.
15% FTSE Canada 91 Day T-Bill Index
15% S&P/TSX Composite Index
70% S&P/TSX Capped REITs Index
Philosophy and process
The strategy aims to achieve added value to its reference benchmark with a level of risk that is equal to or less than that of the benchmark.
Bottom-up investment approach while ensuring thorough diversification among Canadian real-estate sub-sectors as well as macroeconomic analysis and/or a specific investment thesis.
Security selections offer a good balance between Canadian REITs and Canadian dividend-paying stocks:
For REITs: companies with a strong balance sheet and above-average distribution forecasts, while being mindful of acquisition risks.
For dividend-paying stocks: companies with an attractive growth profile, forecasts for above-average dividend yields, and a diversified real-estate sub-sector exposure.
Diversified portfolio of 30 to 60 securities.
The valuation process is based on extensive cash-flow analysis combined with a qualitative framework emphasizing strong business models, management quality, and ESG strengths.
Portfolio construction is a key value-added component.
Why invest in these strategies?
The strategy has demonstrated a favourable risk/return profile as compared with Canadian real-estate investment trusts (REITs).
Historical low correlation of REITs to traditional asset classes and increased portfolio-diversification opportunity.
REITs tend to have a higher distribution rate than other corporations so as to benefit from favourable taxation (taxed only on post-distribution income).
Opportunity to invest alongside a Brendan Wood International 2021-2022 Top Gun Investment Minds team that has been managing the strategy since its inception in 2001.